An REO, which stands for Real Estate Owned, is a residential property owned by a bank, some other kind of mortgage lender, or a government loan guarantee agency such as Fannie Mae that failed to sell at a foreclosure auction. The lender or government loan guarantee agency then attempts to sell the property on the regular real estate market, using a real estate agent or online listings, or both. REOs frequently are sold at a discount, which can make them attractive to first-time buyers as well as rental-property investors.
However, they almost always are sold as-is or with minimal repairs. Often, properties that are foreclosed upon – particularly those that fail to sell at the foreclosure auction – are in less-than-pristine condition. Many need a fair amount of repair and renovation work. Even so, REOs can be a right-priced option for prospective homeowners and investors alike.
Banks operate under different obligations than other individuals when selling their property; timelines and inspections differ, bank-drafted contracts can be very one-sided, traditional closing costs may be shifted to the buyer and delays are common. It’s important to have experienced legal counsel at each step in the REO purchase process.
The attorneys of Weeks & Irvine, LLC, have helped numerous clients complete the purchase of bank-owned property. We work with buyers from the initial loan qualification through the closing, helping clients avoid penalties and ensuring the transaction goes through.
For more information about REO transactions, please contact our firm.
Buying an REO is a new experience for most people. It is important to go into the process with your eyes open and as informed as possible. You should talk to the real estate attorneys of Weeks & Irvine, LLC, in Charleston. We are well-versed in South Carolina real estate law and procedures and can help you with the process.