Subject to 3rd party approval (home, buy)

[b_rush]

[quote=TeamBenya;2776574]3rd party appproval does NOT mean that the bank owns the home. If the bank owned it, there wouldn't be a 3rd party that would need to approve the deal. Bank owned homes are called REO (real estate owned).[quote]

Is it easier/quicker to purchase an REO?

[TeamBenya]

Originally Posted by b_rush

Is it easier/quicker to purchase an REO?

Typically, yes. With a Short Sale, the owner must approve, and then the bank must appprove, and it's that bank approval that takes so long because they do not necessarily know what they will or won't accept. With an REO, the bank has a good idea of the value and how much below the asking price that they're willing to accept.

I have never seen a short sale that has taken less than 48 days from time of offer to time of closing.

I have been able to get a foreclosure done in 12 days from time of offer to time of closing.

Because you're dealing with a corporate entity and not an individual, you may find that every bank has a slightly different time table. Just because it's REO does not mean that it can close quickly.

I had a buyer purchase a foreclosure last year and it took every bit of two months from the time of offer to closing, and we were going cash; no financing involved! The reason it took so long was because the bank did not have all of the name transfer details properly resolved at the courthouse, and we needed several documents filed and signed by a judge in order to proceed.

It was an unusual situation, so don't think of it as typical of an REO to take so long, but do be aware that these sorts of things can and will happen from time to time.

What I tell my clients is that you may need to be flexible with your timetables in order to get to closing when you're dealing with REO's, and even more so with Short Sales.

Hope that helps.

[b_rush]

Thanks. Now I know what to look for.

[1973 Forced Busing]

When you purchase an REO, the owner (the bank) will not be liable for any problems with the house that you discover later. They will not and are not required by law to fill out a disclosure statement. What you get is exactly that. No recourse.

[b_rush]

Originally Posted by 1973 Forced Busing

When you purchase an REO, the owner (the bank) will not be liable for any problems with the house that you discover later. They will not and are not required by law to fill out a disclosure statement. What you get is exactly that. No recourse.

Thanks. I already understand u buy a property As Is which is why the bank should come down on price more. For example, I've seen 3 houses this weekend that have been "winterized" (whatever that means) and it looks as if pipes have burst inside the houses.

[mom2boys37]

Originally Posted by b_rush

Thanks. I already understand u buy a property As Is which is why the bank should come down on price more. For example, I've seen 3 houses this weekend that have been "winterized" (whatever that means) and it looks as if pipes have burst inside the houses.

Usually winterize means draining the pipes, putting antifreeze in the toilets and so forth. Well before I get jumped on for that one..thats what we do with the house we have in Oakland until its ready to move into

[TeamBenya]

Originally Posted by mom2boys37

Usually winterize means draining the pipes, putting antifreeze in the toilets and so forth. Well before I get jumped on for that one..thats what we do with the house we have in Oakland until its ready to move into

No worry of getting jumped on, you're very correct. Because banks aren't looking to spend any more money than necessary to get a house sold, they typically don't leave the power on and thus there's no heat. If the house has not been protected against the pipes freezing, then there is a risk that they may burst.

Short Sale or REOe, both are being sold with a disclaimer, but this does illustrate the one benefit to buying a short sale over and REO. They are often-times still occupied and the deferred maintainence issues may not be as serious as with an REO

[TeamBenya]

Originally Posted by vanyali

And Benya's point about the effects of changing interest rates was correct, though that doesn't necessarily mean (and he doesn't claim) that rates are about to shoot up or anything.

This is a good point. I was not trying to claim that rates WERE about to jump, just that it was a possibility..... As inflationary costs rise in other financial markets, it typically forces the cost of a home mortgage up as well due to how the markets are interconnected, and it's interesting to not what has happened in the last 2 days in regards to mortgage rates.

Washington Post Article on Mortgage Rate Jump

It can very clearly illustrate why the monthly payment of a mortgage is so important to look at. The monthly cost of a home you buy has essentially risen by nearly $100/mo. per $300k of mortgage! This is a .32% jump in mortgage interest rates over one week, despite recent Fed rate cuts and another anticipated Fed rate cut expected next month.

[shrinkingdollar]

Originally Posted by 1973 Forced Busing

Bet nobody in the real estate business will give you this info:

HousingTracker.net: REO Inventory for Washington, DC

MRIS Statistics

real estate charts

You will never have them over a barrel like this again!

Thank you!!!!! I am totally in love right now. Wow! You saved my butt.

[Senior Loan Officer]

This means that the home is set up for a short-sale, and the sales price has to be approved by the lender/bank. And yes, you can get good buys on short sales.

Originally Posted by b_rush

I've been seeing the title phrase a lot when looking for a home in MD. What exactly does that mean? Is the home about to go in foreclosure? Who is the third party, the bank? Could I get a better deal on these houses?