Fixer Upper Properties In PSL

Looking for Bank Owned Property

What does REO mean? They are properties that have completely gone through foreclosure and now belong to the bank. These homes should not be confused with the properties being sold at the courthouse foreclosure sale.

With homes purchased at the foreclosure sale you are usually responsible for any outstanding liens or second mortgages. Also in Florida you have to put down a percentage at the conclusion of the sale and pay the balance within one day. In addition, you also get the property as is with all the title defects and maybe even an occupant that has to be evicted. You will find that REOs are usually much cleaner transactions.

Because the REO did not sell at the foreclosure auction, the bank is now responsible to clean up the title, remove any occupants and generally have the house ready for sale. You do need to know that REO fixer uppers usually are exempt from many of the disclosure requirements of a normal real estate transaction. Because you do not close immediately you do have time to get a full property inspection.

REO’s Bargains Or Not

There is a common misunderstanding that just because REO’s are bank owned they must be a bargain. Many Times REO handyman special properties may not be such great deals. If you intention is to make money on the property you need to be very careful. Just because the bank may be anxious to complete a transaction doesn’t mean that they are going to try to squeeze out every dollar they can. To be a success with REO investing you need to stay current on the local comps and what you can sell the property for. You also have to have a good handle on the costs that will be incurred fixing up the property so that it is saleable. If you buy your REO at the right price the chances are much better that it will be profitable for you. If you are unsure of yourself in these areas it may be better that you joint venture with an experienced investor.

Ready To Make An Offer?

Most banks have REO offices but generally they will list the property for sale with REO real estate agents who will place the property in the MLS. Offers are submitted through the listing agent and then forwarded to the bank where it is handled by the REO department. Many times, the bank will list the property artificially low to get a “auction” situation going and this will cause multiple bids on the property. These multiple bid situations often result in a much higher sale price for the bank.

One caveat is that if you are going to go after REO property you need to have a good deal of patience. It is not uncommon to have a great deal of difficulty working with the bank and deals do have a way of often falling apart. If you are not ready for the frustration of working with the bank you might look for a wholesaler that has already secured REO property and is reselling cheaply. This often facilitates the purchase and you can still get a good deal but without all the hassles. So if you desire a bank owned home in PSL there are lots of ways for you to get it.