REO is a class of property owned by a lender after an unsuccessful sale at a foreclosure auction. If there are no bidders that are interested, then the beneficiary will legally repossess the property.
Short sales versus REO’s? To invest or not to invest? That is the question.
As the last quarter of the year comes to a close, many real estate investors are scrambling to find the best deals out there as many housing markets across the country are appearing to experience slight gains and/or are stabilizing.
The on-going debate amongst top real estate investors is whether to continue to invest in short sales and pre-foreclosures or to go route of investing in REO’s (real estate owned) properties.
An REO property is when the property is turned back over to the mortgage company after an unsuccessful sale at a home foreclosure auction. The appeal of these properties to many investors is the that property has already completed the foreclosure process paired with the opportunity to make cash quickly.
However, that is about as far as the pro’s go where REO properties are concerned.
In order for real estate investors to invest in REO’s, they must have a large amount of liquid cash and have high hopes that the property will appreciate. This method, although might bring in revenue with the right properties can have negative effects as the investors personal accounts are involved when purchasing these properties.
Short sales and pre-closures, however, are quite the opposite. They haven’t gone through the foreclosure process yet the allow room for investors to make a large profit without investing liquid cash. This allows for greater profit for not only for real estate investors but also for buyers who are able to get more for their dollars when purchasing a home.
When you are facing possibility of losing your home, you need to trust qualified short sale realtors who can help you avoid home foreclosure. The experienced and knowledgeable short sale real estate agents at McGeough Lamacchia can help provide alternatives to home foreclosure, helping you keep a roof over your head.
Great blog! Nice information here. Residential real estate investing is the best type of rental property to put your money into. Real estate markets are considered as one of the best investment because it is slow to react to changes in the economy and you are not going to lose 50, 90 or 100% of the value of your investment overnight.