Interested in REO property or a foreclosure in the Greater Los Angeles Area?


	Foreclosed upon and bank owned property purchases require the assistance of an experience professional. For more information, simply contact me through my site or e-mail me. I'm happy to answer any questions you have about real estate foreclosures.

What is an REO?

"REO" or Real Estate Owned are properties which have been through foreclosure and are presently held by the bank or mortgage company. This differs from a property up for foreclosure auction. John Aaroe Group has experience to share with foreclosures and bank owned properties in Sherman Oaks, California

John Aaroe Group has experience to share with foreclosures and bank owned properties in Sherman Oaks, California

When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees amassed during the foreclosure process. The buyer must also be willing to pay with cash in hand. To top everything off, you'll accept the property 100% as is. That possibly may involve current liens and even current denizens that need to be evicted.

A bank-owned property, on the other hand, is a much cleaner and attractive proposition. The REO property was unable to find a buyer during foreclosure auction. Now the lender owns it. The lender will handle 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.

Note that REOs may be exempt from typical disclosure requirements. For example, in Texas, it is optional for foreclosures to have a Property Disclosure Statement, a document that usually requires sellers to tell you about any defects they are aware of. By hiring John Aaroe Group, you can rest assured knowing all parties are fulfilling California state disclosure requirements.

Are REO properties a bargain in Los Angeles County?

It's commonly presumed that any foreclosure must be a bargain and a chance for guaranteed profit. This isn't necessarily the case. You have to be very careful about buying a REO if your intent is to make money off of it. While it's true that the bank is often anxious to offload it promptly, they are also looking to minimize any losses.

John Aaroe Group has experience to share with foreclosures and bank owned properties in Sherman Oaks, California

Look carefully at the listing and sales prices of comparable properties in the neighborhood when considering the purchase of an REO. And factor in any repairs or remodeling necessary to prepare the house for resale or moving in. There are bargains with potential to make money, and many people do very well flipping foreclosures. Still there are also many REOs that are not good buys and may not be money makers.

All set to make an offer?

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

Prior to making your offer, you'll want to contact either the listing agent or REO department at the bank and discover as much as you can about what they know regarding the condition of the property and what their process is for accepting offers. Since banks usually sell REO properties "as is", it's often prudent 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. As with making any offer on real estate, you'll make your offer more attractive if you can include documentation of your ability to pay, such as a pre-approval letter from a lender.

After you've made your offer, it's customary for the bank to make a counter offer. At this point it will be your decision whether to accept their counter, or offer a counter to the counter offer. Realize, you'll be contending with a process that probably involves multiple people at the bank, and they don't work evenings or weekends. It's not unusual for there to be days or even weeks of going back and forth. John Aaroe Group is are used to working around the schedules of this type of seller and will do everything possible to ensure there are no unnecessary delays.