User:EsmeraldaCheever666

From NCSB

The bank owned or REO property is on that was owned by the homeowner but went to auction and the bank took the property back because no-one purchased it there. Typically at auctions, the banks raise the prices above and beyond what the property is worth to try to get back money lost to them in the foreclosure process. There are lawyer fees, auctioneer fees, and major holding costs usually at least $70,000 and up. The banks do not usually make this money back because investors will not usually buy at auction unless the house is priced right.Sometimes this happens but not often.

A short sale is the business my company is in, where a homeowner is behind on their mortgage payments, because of a hardship that has occurred. A hardship such as divorce, illness, job loss. These are all major reasons and some of the most common right now. The fact with the declination in home values coupled with unemployment has been a huge catalyst for our current situation. Of course, the fact that mortgage companies gave out loans like candy to unqualified clients really did not help either. A short sale is when the bank that has not been paid for months buy the homeowner, who suffered a hardship, agrees to a discounted final payoff amount of the loan amount owed. The homeowner has to sell the home to a buyer or investor usually within 30-60 days of the specified short sale amount that was agreed upon.

The short sale homeowner usually stays in the home longer than in an REO property situation. This is one major reason the home is in so much better condition for a short sale purchase.With a bank owned property all utilities have been shut off for a long time, and the property is supposed to be secured from vandalism. This is not always the case because people can sneak in to these properties and damage them. In a lot of cases these are previous owners, who leave the property in disrepair. The longer these properties sit, the more they lose value and the potential for damage is there.

Short sales, on the other hand, are bought below market value so you are usually buying these properties with equity immediately, and they are in very good shape because the owners just left their property.

In summary, there are many advantages to buying a short sale home over an REO property. The short sale houses you can buy with immediate equity, buying under market value, are in good shape usually with no damage at all.These are great purchases for the right buyer, after your due diligence is done. Prepare for the benefits of purchasing your new short sale deal. 任意売却|