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Buying Foreclosures/REO's
What is an REO?
"REO" or Real Estate Owned are houses which have completed the foreclosure process and are now owned by the bank or mortgage company. This is different than real estate up for foreclosure auction. 
When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accumulated during the foreclosure process. You must also be willing to pay with cash in hand. Finally, you'll accept the property totally as is. That could include prevailing liens and even current denizens that may require removal.
A bank-owned property, by contrast, is a much neater and attractive deal. The REO property did not find a buyer during foreclosure auction. Now the bank owns it. The bank will see to the elimination of tax liens, evict occupants if needed and generally arrange for the issuance of a title insurance policy to the buyer at closing.
Take notice that REOs may be exempt from standard disclosure requirements. For example, in Texas, it is optional for foreclosures to have a Property Disclosure Statement, a document that ordinarily requires sellers to make known any defects they are informed of. By hiring RE/MAX Benchmark Realty, you can rest assured knowing all parties are fulfilling Nevada state disclosure requirements.
Is REO property in Las Vegas a bargain?
It is occasionally assumed that any foreclosure must be a good deal and a chance for easy money. This often isn't true. You have to be cautious about buying a REO if your intent is make a profit. Even though the bank is typically eager to sell it fast, they are also motivated to minimize any losses.
 Look closely at the listing and sales prices of similar properties in the neighborhood when considering the purchase of an REO. And factor in any repairs or remodeling necessary to prepare the house for resale or moving in. It is possible to find REOs with money-making potential, and many people do very well buying foreclosures. But there are also many REOs that are not good buys and may not be money makers.
Prepared to make an offer?
Most mortgage companies have a department dedicated to REO that you'll work with while buying REO property from them. To get their properties advertised on the local MLS, the lender will usually use a listing agent.
Before making your offer, you'll want to contact either the listing agent or REO department at the bank and find out as much as you can about what they know about the condition of the property and what their process is for taking offers. Since banks usually sell REO properties "as is", it's often prudent to include an inspection contingency in your offer that gives you time to check for unseen damage and retract the offer if you find it. If, as a buyer, you can provide documentation demonstrating your ability to secure financing, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This goes for any type of real estate offer.)
Once you've made your offer, it's customary for the bank to counter offer. From there it will be your choice whether to accept their counter, or make another counter offer. Your deal might be final in a single day, but that's rare. Since offers and counter offers usually give the other party a day or longer to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer.
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