REO (Real Estate Owned) properties

REO (Real Estate Owned) properties are homes or buildings that banks or lenders have taken back after a borrower’s foreclosure. When someone defaults on their mortgage, the lender efforts to sell the property to recover the owed funds. If the property doesn’t sell at foreclosure auction, it becomes REO and is maintained and sold by the bank or lender. These properties are often priced below market value, offering potential opportunities for buyers, but may require repairs or updates. Buying REO properties typically involves working directly with the bank or a real estate agent representing the lender.