In times like these, when homeowners are losing their real estate to foreclosure, lenders often turn to mass marketing and highly advertised public auctions to unload their REOs. Lenders don’t like to publicize the fact that they’re throwing families out of their home, so you might have to do a little digging for the REOs. Here are three ways:
Attend Foreclosure Auctions
Make note of the lender who casts the top bid for a property you’re interested in and talk business. They obviously earmark the property as REO and are ready to get it off of their books.
Visit the Lender REO Departments
Be ready to show how your bargain offer will save (make?) the bank money. If you run into a bureaucratic stonewall, persevere, because you can get rewarded by both, getting a good deal on a property now, and building a personal relationship that will open the bank’s doors for you in future transactions.
To find REOs that lenders have acquired through foreclosure or “deed-in-lieu” transfers, you can cold call mortgage lenders. You might ask for a list of their REOs. Tell lenders what you’re specifically looking for in terms of location, size, price range, floor plan, condition, or other features.
Work with Specialty Realtors
Once you have identified several advertised foreclosure specialists, call a realtor that specializes in foreclosures and REOs. If they truly understand REOs they should be able to discuss property availability, detailed financing and purchase procedures, hot areas of town, rehab potential, and many other related topics.
REOs can provide just the real estate investment opportunity you’ve been looking for. It may take a little work, but it has proved to be a good real estate investing vehicle.
