Thinking of that "Great Deal"? Here's the Scoop!
Most people think that foreclosures are the deal to go after. Yes, Foreclosures are usually sold for a discounted price but... Here's the Real Scoop.
A foreclosure, or REO, (Real Estate Owned) is a home that is owned by the bank. They propbably tried to sell this house at an auction and no one wanted it or the bids were not high enough. When the Banks get a bundle of these in a certain neighborhood, they usually call one of their contracted agents. These agents are in the business of "Burning and Turning". Here's the truth. They usually don't care about the highest bids on the properties because those bids come with contingencies. These are things like inspections, warranties, appraisals and loans. On top of that, if the buyer needs a loan, the listing agents needs to wait until that loan closes and that could be up to 45 days.
IN WALKS "The Cash Investor". Investors will buy the property "as-is" with no contingencies and will typically close in 15 days or less. The agent makes their commission, quickly! Don't get me wrong, these agents work HARD for their money. That's why the banks trust them! The Bank gets the house off their books and the investor got the deal. That's how it works. Also, homes like this often need so many repairs that the lender will not loan money on the property anyway due to it's condition.
As high as 70% of all REO's are sold to cash investors that the Listing agent already has lined up. The agent "double ends" the deal because they typically will represent the Buyer and the Seller (the Bank) Then, they make another commission by being the listing agent for the Investor.
An REO agent may get as many as 20+ offers on the first day. They will go straight to the "all-cash" offers first.
If no cash investor wants the property or the Bank isn't willing to take less, YOU DO have a chance. But, you will probably have to get rid of some of those contingencies (mentioned above) and that could cost you a lot more.
Give us a Holler. We'll be glad to help you find that awesome House! We have connections!!
Shoot Us A Message, We're Here!
...Or, You Can Call Us!