Looking for REO property or a foreclosure in Arlington?


	Making an offer on a bank-owned property is not something to be taken casually.

What's an REO?

"REO" is an abbreviation for Real Estate Owned. These are homes which have completed the foreclosure process and are now owned by the bank or mortgage company. This is different than a property up for foreclosure auction. Pat Shannon has experience to share with foreclosures and bank owned properties in Arlington, Virginia

Pat Shannon has experience to share with foreclosures and bank owned properties in Arlington, Virginia

If you buy a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accrued during the foreclosure process. You must also be ready to pay with cash in hand. Finally, you'll receive the property 100% as is. That possibly will involve existing liens and even current denizens that may require eviction.

A bank-owned property, by contrast, is a much cleaner and attractive deal. The REO property did not find a buyer during foreclosure auction. Now the bank owns it. The bank will attend to the removal of tax liens, evict occupants if needed and generally plan for the issuance of a title insurance policy to the buyer at closing.

You should be aware that REOs may be exempt from normal disclosure requirements. For example, in California, banks do not have to give a Transfer Disclosure Statement, a document that normally requires sellers to make known any defects of which they are knowledgeable. By hiring Pat Shannon, you can rest assured knowing all parties are fulfilling Virginia state disclosure requirements.

Are REO properties a bargain in Arlington County?

It's commonly believed that any foreclosure must be a bargain and a possibility for easy money. This often isn't true. You have to be cautious about buying a REO if your intent is to make money off of it. While it's true that the bank is typically anxious to sell it soon, they are also looking to minimize any losses.

Pat Shannon has experience to share with foreclosures and bank owned properties in Arlington, Virginia

When pondering what to pay for a foreclosure, carefully analyze comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale. The bargains with money making potential exist, and many people do very well buying and selling foreclosures. However there are also many REOs that are not good buys and may lose money.

Time to make an offer?

Most banks have a department dedicated to REO that you'll work with when buying REO property from them. To get their properties advertised on the local MLS, the lender will often contract with a listing agent.

Before making your offer, you'll want to contact either the listing agent or REO department at the bank and learn as much as you can about their knowledge regarding the condition of the property and what their process is for receiving offers. Since banks most commonly sell REO properties "as is", it may be in your best interest to include an inspection contingency in your offer that gives you time to check for unseen damage and withdraw the offer if you find it. If, as a buyer, you can provide documentation showing your ability to pay, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This goes for any real estate offer.)

Once you've presented your offer, you can expect the bank to counter offer. At this point it will be your choice whether to accept their counter, or offer a counter to the counter offer. Realize, you'll be dealing with a process that probably involves multiple people at the bank, and they don't work evenings or weekends. It's quite common for there to be days or even weeks of negotiating back and forth. Pat Shannon is accustomed to these situations and will work to ensure there are no undue delays.