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Does a 1 to 2 week lead matter
to you in buying an REO? You bet
it does! In calling on a bank's
asset manager to make an offer you
want to be ahead of the competition.
E-foreclosuredata.com does not wait
for the Trustee's Deed to be filed
7 to 10 days after the sale. We
telephone every trustee who has
scheduled a sale and publish the
information one or two days after
the sale.
What is an REO? REO is an acronym
for Real Estate Owned. Years ago
banks did not want to have "bad
loan" departments, so they
called them REO departments. If
a property goes to sale and no one
bids on it, the trustee puts in
a bid for the beneficiary (bene)
or lender. The bid is the total
of the outstanding principal and
interest; any payments made by the
beneficiary for taxes, insurance,
or to keep senior liens current;
and fees for the trustee's expenses.
The latter is governed by the California
Civil Code.
The beneficiary may and sometimes
does enter a bid below the minimum
bid. This is done for several reasons.
First, a bank may plan to wholesale
several properties to a prospective
buyer, so it bids the amount it
will resell the property for. Second,
the REO is considered a non-earning
asset, which limits the bank in
the amount of its resources it may
lend. The bank may want to have
it on the books as having less value,
so it may lend more. Or third, the
bank may want to file a claim with
its insurance company for damages.
It must enter a deficiency bid so
it can claim a loss. |
