Bank Owned-REO
REO•BANK OWNED•SUNNY ISLES BEACH•SIB REALTY•305-931-6931
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Are you a real estate investor or homebuyer looking to purchase a bank-owned property? With the number of bank-owned foreclosures rising nationwide, there has never been a better time to purchase real estate owned by banks.
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Bank owned properties (lender-owned), also sometimes referred to as REO ( real estate owned) homes or properties
Buying Bank Owned Properties (REO)
An REO (Real Estate Owned) is a property that goes back to the mortgage company.
The bank now owns the property and the mortgage loan no longer exists. The bank will handle the eviction, if necessary, and may do some repairs. They will negotiate with the IRS for removal of tax liens and pay off any homeowner's association dues. As a purchaser of an REO property, the buyer will receive a title insurance.
Banks always want to sell a property in "as is" condition
Essentially, there are three different stages at which you can buy a foreclosure property. Investors and homebuyers can purchase a foreclosure property in the first phase of default - before a foreclosure auction takes place. Secondly, investors can purchase a property at the public foreclosure auction. And finally, a foreclosure property can be purchased from the bank or lending institution if no one bids at the public sale and the bank repossesses the property.
Once a property is repossessed by a bank or lender, the property will probably be listed for sale through a real estate agent. Good buys are available, but they require research, preparation, patience and persistence. Buying a bank-owned home in foreclosure isn't easy, and it's hardly without risk. Before you consider plunging into the foreclosure market, be sure to do some in-depth research.
1. Inspect Property.
Most foreclosure properties are referred to by investors as "distressed" properties. Bank-owned foreclosure homes are usually sold "as is," which means that the 15 percent discount you just saved on the purchase price can easily be eaten up by unforeseen expenses - such as repairs not immediately apparent in an exterior inspection. Many owners of homes that go into foreclosure have been struggling financially, which usually means that the house has not received needed repairs or general maintenance for a while. Some homeowners who lose their property to a lender frequently damage the property. So be prepared to do renovations and repairs. Hire a licensed home inspector to give you a written estimate of the cost to repair the property. Budget that number into your purchase price. Repair costs can be used later in your negotiation with the bank to reduce the asking price.
2. Title Search.
Once a home has been located, search the public records for liens and outstanding taxes. You can hire a title company to run a full, insured title search before closing the deal.
3. Negotiate.
Investors should be prepared to negotiate a lower down payment, a lower interest rate, a reduction in closing costs and a lower asking price. Many mortgage lenders may be willing to waive some closing costs, maybe even offer a break on the interest rate or the down payment. Moreover, some lenders might offer to finance the property at a below-market rate or with a lower-than-usual down payment. Don't be afraid to ask for a better price and favorable terms.
4. The Offer.
Although most banks want to unload their foreclosed properties, they won't necessarily do so cheaply. So you aren't guaranteed a fabulous price. But remember you're dealing with an eager seller. Even though the bank's REO manager or their listing agent might suggest that the list price is "firm," never be afraid to negotiate price - especially if the foreclosed bank-owned home needs repairs. When submitting a low offer, you need to substantiate the reduced price in writing and document your case. You should furnish photographs and cost estimates for repairs to support your offer amount.
5. Financing.
With good credit, many banks will loan the full price of the foreclosure or more. If the home is to be used as a rental, many banks will require only a 10 percent down payment. Foreclosure investors with a large amount of equity in another home may get a line of credit from their bank to purchase a foreclosure. When they convert the line of credit to a mortgage, no down payment may be required.
SIB Realty Evelina Tsigealnitskaya Broker and Valeria Mola Licensed Real Estate agent help you to locate Real Estate Foreclosures, bank homes, Foreclosed real estate, Bank Owned real estate and property for sale, REO, Bank owned properties .
Contact us 305-931-6931 or e-mail at SIBRealty@gmail.com
Buy a bank owned property? YES!
SIB Realty 18335 Collins Avenue Sunny Isles Beach, Fl 33160
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SIB Realty • 18335 Collins Ave. Sunny Isles Beach, FL 33160 • Phone: 305.931.6931
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