Las Vegas Real Estate Agent, Las Vegas Homes, Condos, Land, Commercial Real Estate and Personal Blog

Many real estate investors in Las Vegas have never purchased a bank owned or REO (real estate owned) home before and expect all the good stuff that comes with a regular sale such as property disclosures or CLUE reports, negotiations, etc. So I will write about the differences when making an offer for a regular sale (the owner is represented by a Las Vegas Realtor, or not) and a Las Vegas foreclosure real estate sale.

While we can write an offer for a regular sale any way that we want, this doesn’t work while making an offer on an REO home or condominium in Las Vegas.

1: The home or condo that you buy as a regular sale does not have to be sold to you AS IS. Unless the buyer waives his right to the property disclosures, the buyer can and should ask for disclosures and a CLUE report  The CLUE report is like Car Fax and will show the history of any insurance claims for the home or condo.

Foreclosure sales are (as is-where is) and for good reasons, the lender who has foreclosed on a home has not lived in the property and doesn’t know the history of the property. The bank will sell the property as is but this doesn’t mean that the buyer has to buy the home or condo as is and has the right to and should inspect the property by a licensed Nevada inspector. What happens now depends on who the buyer is.

A: Owner occupied homes or homes that have to be financed. In this case the lender may fix appraisal contingent repairs. For example a home that is purchased by a buyer who is financing through a VA loan has to meet certain requirements by the lender such as having an oven, if the home doesn’t have an oven, the lender has to put one in as an appraisal contingency.

B: Cash investors: the bank will often refuse to do any repairs on the home or condo. They also will refuse to contribute anything to the closing costs.

2: Appliances or personal property: these can be sold in a regular sale through a bill of sale however the bank doesn’t do this. Any appliances that are in the home or condo at the time of the offer may or may not be there at the time of closing. There is no bill of sale; however I have not had a deal that the appliances went missing before close of escrow yet.

3: Writing the offer; we can write an offer on a regular sale any which way we want, not bank foreclosures.

Banks look at two factors when reviewing offers written for bank owned homes or condos, one is the price and the other one is the terms. Offers should be as simple as possible with the easiest possible terms. The initial offer on the bank owned home will be replaced by a bank addendum that negates the initial offer and replaces it with the bank contract and is often take it or leave it. This is the reason that banks call it an addendum and not a counter offer.

The above was so Las Vegas real estate investors would adjust their expectation when buying a Las Vegas bank owned home or condo and not to scare them. We make offers on foreclosures all the time and close the deals while protecting our clients. Foreclosure deals in Las Vegas may be a bit harder to close than regular sales, but they are often more than worth the trouble due to the big savings that they offer the investors.