Reo Financing

What Is REO Financing?

REO financing is a term that is used to describe a type of loan known as an REO loan. REO, or real estate owned properties are properties that have been foreclosed on, and have remained unsold via foreclosure sales and auctions for a period of time long enough to result in the revert of the ownership of the property to the bank. These properties are often in need of repairs, and are offered to the public at prices that are significantly lower than the market sale price for comparable homes.

How Does REO Financing Work?

The majority of banks will not provide financing for REO properties, since they consider it to be an "as-is" purchase, which is why many people turn to private lenders like ZINC Financial. Private lenders specialize in financing REO properties and base their lending criteria on the After Repaired Value of the property as well as the amount of cash the investor is able to invest in the purchase.

When evaluating REO properties, ask yourself the following questions:

• What types of repairs are needed?
• Has the bank agreed to pay for any of the repair costs?
• What is the projected resale value of the home once the repairs are completed?
• Is the property in a desirable urban area where families would want to live?
• Will you be able to complete the repairs yourself or hire someone else to complete them without difficulty?
• How long will it take for the bank to accept your offer once you obtain financing?
• The projected resale value of the property or properties once the repairs and renovations have been completed

Asking these and other important questions before purchasing an REO property will help to ensure that you are making the right decision. For more advice, investment tips, and to find out how you can obtain the REO financing that you need, visit www.zincfinancial.net for loan programs and requirements or contact the experts at ZINC today.