Real Estate Owned (REO) properties are generally sold at lower prices than foreclosures, with the goal of making them more attractive to buyers. The longer the lender has it, the more money it will lose. The best thing for them is to sell the property as quickly as possible and invest the money. Any property owned by a bank or lending institution is considered REO. Pre-foreclosure refers to the first phase of a legal proceeding that can ultimately result in the recovery of property from a delinquent borrower.
The lender files a default notice on the property before the foreclosure because the borrowing owner exceeds the contractual conditions for late payments. Pre-foreclosure is the first step in the foreclosure process that begins when the lender notifies the borrower by certified letter of its intention to initiate the foreclosure procedure (notification of default).REO and foreclosed housing are related in some way, as they are part of the overall foreclosure process. A REO property, also known as bank property, has already gone through the foreclosure process and has been taken over by the mortgage lender or bank as a result of a failed foreclosure sale at an auction. A REO foreclosure is property owned by the lender that was not successfully sold at a foreclosure auction. When considering investing in REO or foreclosure properties, it is important to weigh the pros and cons of each option.
REO properties are generally sold below market value and can be attractive to buyers, but they may require more repairs than other properties. Foreclosures may be sold at higher prices than REO properties, but they may also require more repairs and may take longer to close. It is important to understand all aspects of both REO and pre-foreclosure properties before making an investment decision. Knowing how to avoid foreclosure, auctions, and getting your home owned by REO can help you make an informed decision.
