Quite a few foreign investors look for used properties at an opportunity price, often in poor conditions, to later remodel and sell them at a higher value that allows them to obtain a profit that justifies the effort, capital and time employed.
Not a few of those buyers ask for information about "Remates" or properties that the banks have taken from their clients for not paying the mortgages, these properties are known as Real Estate Owned (REO) or the short sale type.
A brief analysis on this topic:
- What is a property of the REO type and how can I access this type of property?
This type of property that previously belonged to owners who fell into arrears or Default, who seized their property. In most cases this happens due to non-payment of obligations to the bank, to the collecting entity of taxes (IRS), to the association of the community (if it exists), etc. When this occurs, the aggrieved party (the bank, in most cases) has the right to begin a property enforcement action for breach.
Once this action is initiated, the procedure stipulates that several instances must be met until the execution of said property is completed. It is important to note that the law allows the owner of the property to complete the aforementioned process before the final execution, as long as the latter pays the accumulated debt plus the related expenses associated with the claim (ie lawyers, etc.).
Once the property is executed, it is auctioned off and the bank that owns the credit has the privilege of acquiring it and that is when the unit passes into the hands of the bank. Once in the hands of these, they are sold as REO properties. These properties can be listed in the MLS (Multiple Listing Service) as they are with regular properties belonging to a particular owner.
Next, the REO properties in the market.