Downey Savings REO Properties for home buyers and investors
Downey Savings, headquartered in Newport Beach, CA, is a federally chartered financial institution. Any mortgage lender that fails to sell a property at a foreclosure auction usually ends up taking possession of such properties. These unsold foreclosed properties held by a bank or a lender are referred as REO (Real Estate Owned). REOs are usually priced below their market value to result in a quick sale by lenders/Banks.
A lender holding REOs has to pay property taxes, hazard insurance, and maintenance expenses for the underlying properties. This is highly undesirable for banks, lenders, and financial institutions as these expenses deepen their already significant losses due to loss of mortgage payments, foreclosure expenses and Realtor’s commissions. A slow and declining real estate environment is another factor that motivates a lender/bank to salvage what they can from an REO property from selling it.
Downey Savings had originated a high volume of loans during the real estate boom years from 02 – 06. As most of these loans had weak underwriting guidelines, the percentage of default and foreclosure rates is significantly higher than what was expected. Savvy investors looking to buy residential properties with significant equity can expect to find them at Downey Savings REO Listings.
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How to buy CitiMortgage REOs
CitiMortgage, headquartered in St. Louis, Missouri, is a member of Citigroup and is primarily engaged in residential mortgage financing. The current crisis in the mortgage industry is deepening due to significant amount of payment defaults and resultant foreclosures. Most of the homes don’t receive favorable bids at the foreclosure auction and this forces the lender to take possession of the property. This vicious cycle is contributing to the significant growth in the inventory of REOs at major lenders. As the mortgage crisis deepens further, the REO numbers are expected to increase even more dramatically in the near future.
Real Estate Investors with a keen understanding of their respective real estate markets can browse through the REO Listings at various lenders and find great bargains. Lenders are motivated to make a deal when it comes to REOs as they are a generally considered to be a drain on their resources. Moreover, in a real estate climate with declining property prices, lenders are compelled to make a deal and dispose of their REO holdings at the earliest. This situation tips the balance towards the buyers/investors and it allows them to make deals that are highly favorable to their bottom line.
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