Short Sale vs REO

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Buyers question. Should I concentrate on Short Sale Listings or Bank Owned (REO) ones?
I’ll advise we look at ALL listing but if we see 2 similar ones then based on the following I’ll suggest going for the REO.

Reasons are:
1. The Bank has major financial reasons for wanting the property off its books so will respond quickly and realistically. Note: If you would like to understand these financial reasons drop me an e-mail and I’ll give you the details.

2. The REO listing and sales price will almost always set a new low for similar homes in similar condition in the same neighborhood.

3. This is not so for Short Sales where the price has NOT been agreed to by the major party, the Lender holding the mortgage. Even if the current owner signs your low price offer, the Lender is not going to do so unless it reflects the fair market value of the property i.e. the price at which an REO would be sold. Typically they will take between 2 and 3 months to actually respond with their decision. During that time you are in limbo.

4. Once the price has been agreed to the Bank will close within a week if you can.
5. Despite false rumours Banks will re-negotiate if major problems come to light through your inspections.
6. Approximately 80% of all Short Sale contracts in my area ever close!
I rest my case.

 

 

 

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