A commercial foreclosure could be your chance to scoop up a property that suits your needs for a lower price. For some, REO (real estate owned) properties can be a good investment—or a good start if you’ve never owned commercial real estate before.
If you’re up for renovating or have an extensive network of clients and customers, buying REO commercial properties for sale could be the way to go. You’ll get a clean title and the opportunity to purchase at an often lower-than-retail price.
You want bank-owned real estate. But you need help figuring out how to find it. Keep reading for more on how to find REO real estate and what to do once you see a property you like.
The Best Ways to Find Bank-Owned Property
When a business defaults on its property loan, the lender can cause it to foreclose and take back the property.
Typically, banks don’t want property sticking around because it adds to their risk. Banks put REO properties up for auction before listing them anywhere else. If no one bids on the property at auction, the bank will list it with brokers or another third party.
Below are three ways to find commercial REO property listings.
1. Look for Auctions
The first place to look for REO listings is local auctions. Banks will try to auction off foreclosed properties first. If you want to bid on a bank-owned property, check the newspaper for public notices about foreclosures and auctions.
You can also browse auction houses online to see what’s available and determine where auctions will take place. A resource like Auction.com houses auction listings across the country. You can save listings for later and print out important details.
2. Search Online
You can often find lists of bank-owned properties on individual bank websites. If you’re already a customer, you may want to work with the same bank on your REO purchase.
Some banks have web pages where you can browse their inventory. Other bank websites tell you what broker or management company they partner with, so you can get in touch with the right people.
You can find commercial foreclosure listings on popular real estate websites, too, including:
Licensed brokers and realtors may have access to the MLS (Multiple Listing Service) national database, which features numerous listings and helps compare properties. Local brokerages, like Commercial One Brokers in Branson, MO, may also display foreclosed properties on their websites.
You can even check for seized properties online; the IRS has an auction website.
3. Work With a Broker
If you’re truly on the hunt for REO properties, your best bet is to team up with an experienced broker. Local brokers have connections to banks and know what’s moving in the area.
You’ll pass the heavy lifting to the broker, gain their market insights and get access to their network. Beyond finding your commercial property, brokers also help you negotiate for the best deal.
Are you interested in property in Branson, MO? Contact Commercial One Brokers today!
How Do I Find Out What Bank Owns a Property?
You may have stumbled across a property another way. How can you tell what bank owns it?
Check the “for sale” sign for contact information if you see the property in person. That information will lead you to the brokerage or management company, and they can tell you which lender owns the property.
You can also go to the county courthouse to find auction announcements, deed information and records on who paid taxes on the property.
If you work with a broker, you can glean who the lender is by searching through the broker’s assets or connecting with others in their network.
Your Chance to Buy REO Commercial Properties
When you find an REO property you want, it’s time to think about the buying process. First, the foreclosed commercial property will go to auction. If you want to bid, you can attend or send someone in your stead.
Keep in mind the lender can offer a credit bid (AKA: The total of all debts, fees and foreclosure costs) to recoup the defaulted mortgage. Often, the lender is the highest bidder at auction, meaning they walk away with the property.
At that point, the property becomes bank-owned. Since most banks don’t want to be tied to properties, they list them on the market with a third party. Then, you can come in and make an offer. Researching and working with a broker can help with this!
REO Property Buying Recap
- REO property goes up at public auction.
- Bid at auction.
- The bank is often the highest bidder.
- Wait for the bank to complete REO repairs and list the commercial property.
- Find the REO commercial property listing.
- Talk to your agent or brokerage.
- Make an offer.
Tips for Buying REO Real Estate
Make your offer shine through. Remember that the lender calls the shots in an REO negotiation, but they want to sell the property. They don’t want to hold onto it. Aim to make the process quick and easy for them while still coming out with a good deal.
Here are some tips for buying commercial real estate owned properties:
- Start with a lender. Talk with lenders about funding before making an offer to kick off the loan process.
- Show them the money! Provide proof upfront that you have the funds.
- Be ready to close early. Banks often like to close quickly. Be prepared to close within seven to 10 days.
- Shoulder responsibility with repairs. Most REO real estate is sold without renovations or big repairs, so don’t ask that of the lender.
- Offer to split fees. Agreeing to split the foreclosure fees in your offer doesn’t hurt a bit!
You know where to look and what to do once you find a property to purchase. Start your search for commercial REO property listings.
REO properties can be great deals for those unafraid (and with extra cash) to renovate and make the place theirs. You’ll get a clean title and a chance to repurpose the space. If you’ve already got a buzzing business and loyal customers, an REO property may be what you need to expand your company.
Contact Your Trusted Broker
In the market for commercial real estate in Branson, MO?
You’ve come to the right website. Commercial One Brokers knows the Branson area and partners with you to find your business an amazing space.
Contact the experts. Let’s get you into a new property!