What are REO’s – Real Estate Owned?
A REO is similar to buying a short sale with the exception being that the property is already owned by the lender. Most of the time the property was acquired by the lender through a foreclosure action. Lenders will often sell repossessed homes for less than the loan balance. Lender owned properties are called REO’s, meaning Real Estate Owned by the lender. Most of the time lenders end up with the property after the public auction bid was not enough to cover the amount owed. REO homes are many times considered the best way to buy distressed properties due to the fact that the seller is already out of the equation. It’s just the investor, the investor’s agent, the lender and the lender’s agent who are negotiating the transaction.
