Understanding Pre-foreclosures, Short Sales, and REO’s

If you want to make money in real estate, buying and selling foreclosed properties can be very profitable. When a homeowner defaults on their loan, the bank repossesses the property and resells it. Banks make money on the loan and lose money when holding properties, so they are very eager to sell once they are forced to foreclose. This can be a great opportunity for investors who are ready to buy.



The first step in buying foreclosed properties is to be prepared. You don’t have to do this yourself. You can find a broker who has significant experience with REO properties to help you with your research. REO stands for “real estate owned,” which is how banks refer to repossessed properties in their P&L statements. Most banks prefer to de View the rest of this article