Real estate owned (REO) is a term used to describe a property owned by a lender because it failed to sell at a foreclosure auction. This typically happens when the homeowner falls into foreclosure and is unable to pay their mortgage. REO properties are then acquired by the mortgage lender, who is then responsible for finding a buyer.

REO properties are an attractive investment opportunity for buyers since they can often be purchased at a discounted price. Many buyers are looking for discounted properties as an investment or a stepping stone toward home ownership. Furthermore, most lenders are willing to negotiate on the price during a sale.

Banks generally market their REO properties through a realtor, either to a local area or by listing them online. The realtor then provides the lender with a few options that they suggest performing to make the property more saleable. REO specialists are sometimes hired to assist the process in order to get more buyers interested in the property.

REO properties are usually sold in “as-is” condition, which means they may require extensive repairs and renovations to make them habitable. As a result, potential buyers need to be aware of the potential cost involved in making the property livable before they make an offer.

In spite of this, REO properties are an attractive investment for many buyers who are looking for discounted prices. With the help of a realtor or REO specialist, banks and lenders can often find the perfect buyer for their REO properties.