Bank REO Properties
Real Estate Owned(REO) or bank owned property is where the borrower no longer owns the property in which he or she had financed. The borrower has lost their property through a legal process called foreclosure, which is a process where the real estate is liquidated by the lender. When the homeowner became delinquent on the mortgage payments, the lender has to foreclose on the home if there were no other options completed. When the bank foreclosures on the property and it does not sell at auction it becomes a REO. All REO properties have to be sold off at some point in the future. Banks are not in the business of acquiring and holding on to real estate, they want to liquidate them as quickly as possible.
After a property becomes a REO the bank is looking to fix up the property if they need to do so, and they do it based on complicated mathematical formulas to see what is the most cost effective way to get rid of it. A bank will maintain the property, market and sell the property to the highest bidder as soon as they can. They are not interested in holding on to the property for any extended length of time that they do not have to. If you are homeowner and your home goes to auction for non payment, once it becomes a REO it might be very difficult to get the property back in your possession. You would need to check to see if your property is redeemable or not based on your state‘s law. There are states allow for auctioned properties to be redeemed by the borrower and some do not. There is chart on our site which is fairly hard to find elsewhere, it gives detailed information once a property becomes a REO; it cover whether or not the property is redeemable based on the property’s location, the time frame that is allowed to redeem the property if it is redeemable, the cost for each state, among other pertinent information. Regardless, from the point where a borrower is trying to reclaim their property to reclaiming it is an up hill battle. All of the outstanding balance has to be paid off, and I do not mean making a partial payment on the total past due amount, I mean paying off the delinquency in full within a fairly short amount of time. The borrower would need to have a reliable contact person at the mortgage company to make sure everything is going as planned. It is always far more important for a homeowner to pay of their outstanding mortgage balance a head of a foreclosure sale, because it is a lot less stressful and less expensive at that point to do so. Once the property is sold it far more difficult to regain it.
Non The Less, because your property became Real Estate Owned it does not necessarily mean that it is over for you to get your home back after the auction. You can still save the property in some cases, but all I am saying is that it is very time sensitive and expensive at that point. If you have any control over the situation, do not let it get to that point unless you are willing to shell out some big buck just to get the property back. It is far less expensive to take care of any past due payments ahead of time, and avoid the expense and stress of your home becoming REO.
