How do I determine the purchase price for an REO property?
When available, the amount listed on Bank Homes Direct is usually based on the unpaid loan balance owed the lender. Therefore, any offers made to the foreclosing lender should start at that amount since it is the amount the lender needs in order to break even on the property. However, if the foreclosing lender has gone ahead and listed the property with a real estate agent (known as an REO agent), then the asking price can be easily found in the Multiple Listing Service (MLS). If you are working with a real estate agent (which is recommended for first-time foreclosure buyers), ask the agent to obtain a Comparative Market Analysis (known as a CMA) for a property you have selected. The CMA is a standard marketing tool used by real estate agents in every community and made available without charge to realtors by local title and escrow companies. These reports contain important information about the property including vesting confirmation, liens of record and a plot map showing the physica
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