What is REO?

Real Estate Owned or REO is a term used in the United States to describe a class of property owned by a lender, typically a bank, government agency, or government loan insurer, after an unsuccessful sale at a foreclosure auction. Buying and selling REO properties is different than that of a traditional sale, so it’s important to have an experienced Realtor, such a Guardian Real Estate, who knows the ins and outs of this entire process.

When Foreclosure fails

When a bank forecloses on a property, the lenders do not set price based on market value, instead the price is usually based on the remaining mortgage balance, interest owed, attorney’s fees, and costs generated by the foreclosure process. In a soft real estate market, these costs can exceed market value and thus generate no bids at auction. At this point the lender will usually prepare the property for sale.

Working with REO properties, on either the buying or selling end can be a difficult path to navigate for the inexperienced broker or potential buyer. The staff at Guardian Real Estate has over 20 years of experience working with REO properties from both sides. Call us today for a consultation on your REO property needs.