Why REO Properties Need To Be Secured Quickly
What is REO?
Real Estate Owned or REO is a property owned by lenders. These lenders can typically be banks or government agencies who handle the property after an unsuccessful foreclosure auction. REO can apply to a wide range of properties, not just houses, where the borrowers have defaulted on the loan. If you are considering buying an REO property you are essentially purchasing it from the bank. Banks don’t want to hold on to property as their main line of business is elsewhere.
Unwanted Guests in REO Properties
One of the most common issues surrounding REO houses or other structures is that they are attractive targets for opportunists like squatters, thieves, vandals or animals. Squatters have been known to be very tough to evict and vandals have been known to really damage unoccupied properties. Since most structures typically have a good deal of copper piping and wire, which are valuable, their extraction can cause severe damage. If the REO property has broken windows or open doors, then it is exposed to the elements which can then cause serious damage such as mold due to moisture. People, animals or pests can affect the property in such a way that it no longer meets code. In any event, this equates to a loss of value on your investment and possible legal action from the city or township.
Securing the Property
By now you realize how important it is to quickly secure the property. There are several techniques employed to get the job completed correctly. First, door locks should be replaced or rekeyed, especially if they are broken and ineffective. Broken windows need to be boarded to prevent access and keep the property protected. If the property contains hazards like a swimming pool, securing those as well should be considered for safety. After the above considerations have been addressed and depending on your preference there are two ways you can go about ensuring the property stays secure. Perhaps the easiest and most neighbor friendly method is to make the structure appear to be lived in. It’s very easy to set electronics and lights on timers (a synchronize the timers). Timers also exist for hose bibs meaning you can have your lawn sprinkler turn on automatically. If the above method is not feasible then you will want to board up the unit. While this may be labor = intensive; it is the surest way of protecting your REO for an extended period. Consider installing a home security system as an added deterrent.
It’s always a good idea is to employ professionals who have a depth of experience in the REO preservation and management process. Property preservation companies exist for the sole purpose of preserving and preparing the property for sale.