Buying REO Properties from the Lender


#1

Hi, I would like to know how to purchase properties that have been foreclosed by the lender but not on the market.
I have notice that many properties go to auction and goes back to the lender because there were no bidders.
Please let me know the procedure to find out how to purchase properties directly from the lender that has not been on the market yet.

Thank you.


#2

HI Julius,
You can see the foreclosure inventories (which includes bank owned properties) in the Stats and Trends area of ForeclosureRadar. http://www.foreclosureradar.com/california-foreclosures.
Although it is possible to purchase properties directly from the bank prior to listing them it is not necessarily easy. Many of the larger lenders will require the property to go through the normal channels. This means assigning the property to an asset manager that then assigns it to an approved local agent. That agent will be required to do the occupancy check and evict the occupants when necessary (or negotiate the cash for keys) and then prepare the property for sale. This could mean simply trashing out the property or it could mean making repairs. Provided there is no curative title work that needs to be done (which could cause additional delays) the agent will perform a valuation (typically a Broker Price Opinion) and submit it to the asset manager. The asset manager will typically order additional BPO’s from other agents and then set the list price. That is when the property would be listed.
You MAY have better luck trying to purchase properties directly from the bank when the foreclosing lender is a smaller local bank, credit union or private beneficiary. You can find a list of the REO properties and sort by lender name with a subscription to ForeclosureRadar.com.