CJNR

REO” stands for “Real Estate Owned” properties. REO properties are known as bank owned residential property, bank REOs, house foreclosures, etc. “REO companies” are businesses that deal exclusively with these investments. Foreclosure has been all over America for the past couple of years.

This phenomenon is expected to continue unabated for the next 2-3 years or longer. As a result, foreclosure property investment has become an industry unto itself.

There is a huge number of homes in various stages of foreclosure. This is the reason why a number of companies and businesses are dedicating their time in the acquisition and resale of foreclosed properties all over the country.

They are called “REO companies” or “REO Asset Management Companies”. As foreclosure properties continue to pull up headlines, a number of investors and real estate professionals start to approach banks and lenders for the lists of bank REOs.

When the banks supplied these lists, they also provide the selling prices that they would accept for those homes. At the time, making a foreclosure property investment was basically an informal process done on a bank-by-bank, house-by-house basis. However, that changed when foreclosures began to sweep across the US like a tidal wave.

Banks and other lenders were literally being inundated with foreclosure properties every week and began to seek means to cut their losses and unload these bank REOs. American entrepreneurial spirit, specialized new companies began to take shape.

Several companies consider themselves as REO Asset Management Companies but most of them do not make money in selling foreclosed properties. Most of them do not have the experience, fund, management relations to banks, network of realtors and others. Only those with the above skills become profitable in investing in REO properties.

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