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FHA REO's

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Bobby Bucks

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Jan 27, 2002
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Real Estate Agent or Broker
State
North Dakota
Is anyone doing FHA REO work? i had a solicitation for doing some......as much as I like REO work I'm cautious......I have visions of 10,000 VC sheets with each report. :).....i'm curious if HUD treats them the same as purchases and refinances report wise.
 

Jo Ann Meyer Stratton

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Jan 16, 2002
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Certified Residential Appraiser
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Arizona
I have been doing FHA REO work for years--before and after 1999. The main difference is you arrive at a value "as is" instead of "subject to". But you still do the VC sheet listing all the problems. And there are some specific comments about being insurable or uninsurable with or without utilities. If you do decide to do some FHA REOs go to HUD.gov web site and find several mortgagee letters--Mortgagee Letter 00-027 is the most important one, it describes exactly what verbiage and info is needed in the report. Also check out 00-47, which lists the National Management and Marketing contracts, although there might be a more recent list. They are the peope that clean up the property and maintain the property until it sells. You gain access to the properties from them. Typically it is a master key and once you have that you can access any FHA REO in their area--which means you don't have to make appointments or arrange to meet someone. Appraisals are ordered through Appraisal Management Companies and various AMCs have contracts for different parts of the country. Arizona HUD REOs used to ordered out of CA, now they are from an AMC in VA. All REO work is the "wave" of the future as this $0 down, 100-125% financing hits illness or layoffs or other calaminities. There are also companies that check up on the Management and Marketing companies, so when you are in a HUD REO--look for the signup sheet, everybody has to sign, date and state why they were in the home. Those sheets get quite lengthly and chatty at times! It is surprising how much traffic a REO home gets between M&M contractors, maintenance contractors, appraisers, real estate agents, etc. Realtors will have the same key and use it to show or pre-view that home.
 

Bobby Bucks

Thread Starter
Elite Member
Joined
Jan 27, 2002
Professional Status
Real Estate Agent or Broker
State
North Dakota
Jo Ann many thanks! :)
 

Jo Ann Meyer Stratton

Elite Member
Joined
Jan 16, 2002
Professional Status
Certified Residential Appraiser
State
Arizona
I had another thought. Go to HUD.gov look for the homes available for sale. From that web site you can find all the homes for sale by city or zip code or state by HUD, VA, Fannie Mae, Freddie Mac, Rural Development, US Marshall's Service, IRS, Customs, and several other federal government agencies that I can't think of now. Check out your service area and see how many REOs there are. It is also a way to track info on REOs for your area as most of the agencies do not list the properties with a realtor--and don't report a sale price when it sells. So to track the info each web site has to be viewed several times a month (or week if there are a lot!) to keep current. Some realtors cruise the sites every day and then start marketing them without a listing--they specialize in selling REOs. VA's are neat, it has interior photos as well as several front and rear photos--even moving pictures so that it feels like you are standing across the street moving your head from right to left. But the final sales price for HUD gets posted once when it sells and then the info disappears. There will be phone numbers for the management companies with most of the sites--another source to contact.
 

Bobby Bucks

Thread Starter
Elite Member
Joined
Jan 27, 2002
Professional Status
Real Estate Agent or Broker
State
North Dakota
Jo Ann thanks again....very good advice. Another thing I’ve done is cross reference MLS for REO and/or bank owned properties. Some of the companies allow the listing agents to order appraisals
directly or recommend the appraiser. I get 3-4 a month like this from the listing agents. Some agents I know get 90% of their business from REO’s on the list and sale end. For some reason these agents are far more professional than the run of the mill real-ah-tores. My favorite trick is to
quiz these agents on the condition of listings and sales......they either get annoyed or impressed.....if they’re impressed I get referrals. :)
 
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