With the growing number of short sale and REO properties coming onto the market, it is important to know the difference between the two.
Short Sales
Short sale is the process a homeowner attempts to go through to prevent foreclosure. They ask the lender to forgive the debt since they are selling the property for less than what is owed. The sale is contingent upon approval by the lender. There is no guarantee that the bank will accept a short sale even if the buyer offers the full list price.
In these situations, the seller still owns the property. When purchasing a short sale, you normally have to accept the property in ‘As Is’ condition. You are still allowed to ask for a home inspection period, termite inspection, and survey like a normal transaction.
REO – Real Estate Owned
REO stands for Real Estate Owned. These are properties that have already been foreclosed on, so the bank is now the owner/seller. The bank now wants to sell the property hoping for fair market value.
The approval process is much quicker than the short sale process, only taking 1 to 2 days for a response from the bank. The property will be sold in “As Is” condition, and a Seller’s Disclosure will not be provided by the bank. You are still allowed to ask for a home inspection period, termite inspection, and survey like a normal transaction. We have a number of bank owned listings. Please call or e-mail us if you
are interested in finding out more about our REO listings.
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