· Bank Owned o The bank has taken ownership of the property. This is where the bank is the seller. · REO or Real Estate Owned o This means it is simply “bank owned” . REO properties are on the open market for people to buy. · Foreclosure o This is the process by which a lien holder acquires the property through court procedures. Each state operates a little differently, but this process can typically take several months once started and typically does not start until the owner is 60-90 days behind in payments. · Pre-Foreclosure o This is commonly referred to as the time during the foreclosure process but before the actual taking of the property by the bank. In this time period you can make an offer on a property and still be negotiating with the seller however, bank approval is required in this process. This is also known as a SHORT SALE. · Short Sale o When a seller is in a distressed situation and the offer that is submitted does not cover the expenses to sell the home and pay off the lender, the seller may ask the bank to take a “short payoff” on the loan, meaning to accept less than what was owed to the bank at the banks expense. Banks will sometimes do this because they do not want to own properties, they want to do what they do best and that is financing not selling homes. Each circumstance is different and the bank is not required to accept any short payoff. |
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