How To Buy REO Bank Owned Properties In Port St Lucie FL
Buying Foreclosure Properties
The economic meltdown of the last decade has changed the landscape of the real estate and real estate investment foreclosure properties. The appearance of new terminologies such as Bank Owned and REO in our daily vocabulary has also meant the introduction of a new real estate market with rules different from the traditional real estate that we were accustomed to in the past. Although the opportunity to buy a REO property for below the fair market value is a tempting proposition but in reality, it might not be as simple as it sounds. Many of these properties have been neglected for a long period of time and are in a dire need of repairs. While some repairs could be cosmetic and visible to naked eyes the other hidden repairs might prove more costly that one has estimated. Some foreclosure properties could have been affected by other liens and deficiencies, such as non-payment of utilities or local taxes.
The Difference Between Foreclosure and REO or Real Estate Owned
Buying Foreclosure Properties in Florida
It is imperative that all buyers conduct a thorough due diligent prior to taking a step toward buying foreclosure properties in Florida. To start let’s examine the meaning and the process of the foreclosure along with the requirements that buyers have to comply with when acquiring such properties.
Foreclosure Process: After courts grant judgment to financial institutions, primarily for non-payment of the mortgage by the homeowners, the banks start the foreclosure process. The purpose of the foreclosure process is for the banks to recuperate the unpaid balance of the loan, accrued interest, attorney fees and other costs associated with a foreclosure process. The next step for these financial institutions, or the trustees, is to try to sell the foreclosed properties through a foreclosure auction process.
Requirements to Buy a Foreclosure Property: To buy a foreclosure property the buyer needs to have a cashier’s check for not less than the full amount of the minimum bid, all previously mentioned costs. Another important point to consider when purchasing any foreclosure property is for buyers to acknowledge that they will receive the property “AS IS”. In the case of foreclosure properties the term “AS IS” has a very broad implication, which could include buyers’ responsibilities to see that the property is vacated by previous owners, tenants or any other occupants. Buyers also assume responsibility for all liens, unpaid taxes and zoning violations that might have encumbered the title to the property.
Buying REO or Real Estate Owned Properties in Florida
Many foreclosed properties do not receive enough bids sufficient to cover the minimum bid that is set prior to the auction. At this time, all unsuccessful foreclosure properties become a property of the bank and referred to as Real Estate Owned or REO. This means that REO properties are actually the by-products of failed foreclosures and a result of the unsuccessful foreclosure process. The risks that were associated with foreclosure properties are reduced drastically when they become Real Estate Owned or REO Properties. When purchasing REO properties the buyers will receive the properties as vacant and don’t have to worry about evicting the tenants or previous homeowners. Also, all past due taxes along with other encumbrances such as liens and zoning violations will be cleared by the financial institutions that are in possession of the REO properties. This means that unlike the foreclosure properties the buyers of REO properties would receive a title or deed that is free and clear of any and all encumbrances.
The REO properties are normally listed somewhat below the fair market value and do not carry the risks that are associated with most foreclosure properties. While the bank-owned, REO homes are good choices for first-time home buyers, investors and anyone in need of dependable housing, but like any other investment the homebuyers might do their homework and always employ the assistance of a real estate professional.
REO, Real Estate Owned Properties in Port St Lucie
Buying REO, Real Estate Owned, or as commonly known the Bank Owned Properties in Port St Lucie offers all advantages that we discussed earlier plus a better price point that results in getting more properties for your the money. The 2014 year-end analysis of the real estate market in St Lucie County is clearly the indication of the fact that the better deals are still in this country. The following data is compiled from the annual report by Florida Realtor Association, FAR:
While the Median Price for St Lucie County for 2014 established at $145.000, the Median Price of $218,000 was recorded for the neighboring Palm beach County during the same calendar year. Also at the same period, the St Lucie County homeowners enjoyed a higher rate of appreciation on their real estate, by 16.3%, against the 11.8% increase in property values in the Palm Beach County. From major cities in St Lucie County the City of Port St Lucie showed a 16% appreciation, with Median Price of $145,000 while Jensen Beach showed their Median Prices dropping from $250,000 to $179,000 or a 12.7% decline and Stuart had an increase of 14.7% bringing their Median Prices to $188,000.
Although the opportunity to buy a REO property for below the fair market value is a tempting proposition but in reality, it might not be as simple as it sounds. Many of these properties have been neglected for a long period of time and are in a dire need of repairs. While some repairs could be cosmetic and visible to naked eyes the other hidden repairs might prove more costly that one has estimated. Some foreclosure properties could have been affected by other liens and deficiencies, such as non-payment of utilities or local taxes.
Studying this report proves that while some markets are heading toward becoming out of reach for many middle-class families, Port St Lucie, and St Lucie County homes are still within the reach and are the clear choice for homebuyers and investors alike.