Real Estate Owned

Real Estate Owned

Real Estate Owned

REO

Bank Owned Property or Real Estate Owned(REO) is where the homeowner no longer owns the property in which he or she was financing. This is where there was a foreclosure sale of the property, and the borrower is no longer the legal owner of the home. When a the homeowner became delinquent on the mortgage payments, the lender has to foreclose on the home. Once the bank foreclosures on the property it becomes a REO. All REO properties have to be sold off at some point in the future.

When a property becomes a REO the mortgage company is looking to fix up the property if they need to do so, they do it based on complicated mathematical formulas to see what is the most cost effective way to get rid of it. They 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. 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. Some 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.

Regardless, not because your property is Real Estate Owned it means it is over for you ever getting 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.

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