Ron Denhaan, Realtor (949) 290-3263. Coto de Caza real estate specialist.
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REO properties in Orange County, CA - Distress prperties and great deals

 Bank Owned / REO properties in Orange County, CA

Orange County Bank Owned homes, REOs, foreclosures, properties in distress, bargain properties, and short sales. REO is short for "Real Estate Owned", which means the same as "Bank Owned". An REO is different from a foreclosure property in that the lender has already tried to sell it at a foreclosure auction and has had no luck getting bids. Because the property was not bid on, the lender then became the owner of the property. Naturally, they do not want to keep the REO any longer than possible. This makes it a great opportunity for a homebuyer or investor. Not every REO is a great deal, but many are available for well below market value. Bank owned properties are often the home of choice for investors, as they can usually be bought cheaply, fixed up, and re-sold (known as "flipping" a property). They are also great for purchase as rental properties. Use the home search links below to find distress property and homes that are bank owned, in Orange County, CA. 

Bank owned properties are less troublesome to purchase than Short Sales. Offers on REO homes typically receive a fast response from the lender. On a short sale offer, a response can often take weeks or even months. It is further complicated if there a more than one lender on the property. They all have to cooperate with the short sale. This is never the case with an REO because there is only one lender. Also, REO properties are more convenient to show as they are always vacant. Bank owned homes include condos, townhomes, single family homes, and custom estates. There are also bank owned lots, raw land, and acreage for sale. Call me if you are looking for an REO agent or bank owned homes. Also distress properties, good bargains, houses in default, foreclosure, bank owned condos, or real estate in Orange County, California.

If you would like additional information on the differences between a Bank Owned sale, Standard sale, and Short Sale, visit my page here.

If you are interested in fix up properties for sale in Orange County, CA, visit my web page, here


REO home search

Search for bank owned, REO properties in the location of your choice, including Coto de Caza,  Aliso Viejo, Dove Canyon, Ladera Ranch, Laguna Hills, Laguna Niguel, Las Flores, Wagon Wheel, Mission Viejo, Lake Forest, Las Flores, Rancho Santa Margarita, Robinson Ranch, and  San Juan Capistrano, Beach area cities, include Corona Del Mar, Costa Mesa, Dane Point, Huntington Beach, Laguna Beach, Newport Beach, Newport Coast, and San Clemente. North County locations include Brea, Fullerton, Orange, Placentia, Villa Park, and Yorba Linda

REO homes by price range

If you prefer to search for homes by price range, here are a number of links for REO properties in South OC, north OC, and in the beach and coastal areas.

Bank owned lots and land

Bank owned lots and land - Coastal and Beach areas Bank owned lots and land - Inland and Canyon areas

Looking in a different area? Call me! (949) 290-3263



Why purchase a bank owned, REO property?

  • All liens against the property are removed once it becomes an REO, and taxes are paid.

  • Unlike properties at foreclosure auction, REOs can be inspected prior to contract, and are listed with real estate agents.

  • While many foreclosures are often in deplorable condition, REOs are typically restored to at least a readily salable condition by the lending institution.

  • The bank or lending institution that owns the property will often offer financing with better deals then they would offer on traditional properties.

  • The bank or lender that owns the property will often provide an allowance for certain repairs (unless sold "as is")

  • You can save money in your title search if you use the same title company that the lender used during foreclosure. They will often discount the cost up to as much as 100%!

  • REOs will often times include appliances

  • And most importantly.......you can save a lot of money $$$

More advice on buying REO properties

  • Have your agent run a CMA (Comparative Market Analysis) on the home to be sure you are getting a great price.

  • Check the total cost of ownership, including taxes, Mello Roos, association fees, insurance, etc This is especially important if you are buying the home for investment (e.g., as a rental property).

  • Be aware that many REO properties are sold "as is". In this case, the bank will often be unwilling to do any repairs to the property, so you should factor this into your purchase decision.

  • Banks are also exempt from having to provide a Transfer Disclosure Statement (TDS) or other standard seller disclosures that help you determine the condition or past history of the home. Because of this, all buyers considering the purchase of an REO property should be prepared to order a home inspection through a certified home inspection company. The small cost of a professional inspection may save you a lot of heartache later, especially if serous problems are found with the home.

  • Set proper expectations regarding sales price. Buyers should be aware that the majority of bank owned properties are already very aggressively priced. The reason is that the banks are very anxious to get these properties off of their books, therefore, they are typically "priced to sell".  Many people (especially those that watch late night infomercials) feel that they should be able to get a foreclosed property for 10 cents on the dollar. This is unrealistic, as banks simply don't wish to give properties away. While you may certainly negotiate the price, I would advise a buyer to avoid "low ball" offers, or to expect a massive discount off of the list price. Instead, offer a reasonable price for the home, or work with the bank to arrive at a win-win situation.


The Foreclosure Process

 

There is some confusion among home buyers as to the difference between a bank owned property, a home in foreclosure, repossession, an auction sale, or a court house sale. How does a property become bank owned or an REO? Before a bank or lender takes a property back, the former owner first goes through the process of foreclosure.

Definition of  Foreclosure

A foreclosure is a legal process by which a defaulted borrower is deprived of his or her interest in the mortgaged property. This process starts when a property owner misses or cannot make principal and/or interest payments on a home loan. The bank or lender then takes steps to warn the home owner, and finally, to start the legal process of taking the home or property back. A foreclosure process can be started by the primary (first mortgage) lender, or by a secondary, or junior lender (second trust deed, private second, personal lien, etc).

Foreclosure Steps

After a designated period of missed payments, the bank or lender orders a trustee to record a Notice of Default (NOD). This puts the borrower on notice of  foreclosure and starts a reinstatement period that typically runs until five days before the home is auctioned off.

If the default isn't corrected within the designated time period (typically 3 months) a foreclosure sale date is established. The home owner will receive a Notice of Sale. This document is also posted on the physical property. The public is notified about any local Notices of Sale by publication in County  newspapers.

The actual foreclosure Trustee Sale occurs on the steps of the local courthouse. At the Trustee Sale, the property is auctioned off to the highest bidder, who must pay the high bid price in cash. A wining bidder will then receive the trustee’s deed to the property. At the courthouse auction, an opening bid on the property is set by the foreclosing lender. There is always an opening bid, which is equivalent to the outstanding loan balance, interest accrued, and any additional fees and attorney fees associated with the Trustee Sale. If there are no bids higher than the opening bid, the property will be purchased by the attorney conducting the sale, for the lender. Typically, more then 99% of homes or properties fail to sell at the courthouse auction.

If the opening bid is not met, the property is returned to the bank or lender who started the foreclosure, and the property becomes an REO or Bank Owned property. The bank or lender will then begin the process of marketing the property for sale by hiring a real estate broker to sell the property. Due to the volume of foreclosures, banks and lenders generally sell these properties "as is", and are willing to do little or no repairs to the property.


Related links

REO agents in Orange County, CA. If you are interested in an OC bank owned, REO, foreclosure properties and distressed properties in Orange County, CA, please call me. I will be happy to assist you with a bank owned property in Orange County, CA, as well as a regular home sale, purchase, lease, lease-option, or rental.

 

 


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