A law firm in Burr Ridge, Illinois, Codilis & Associates offers various legal services with a focus on the real estate industry. Codilis and Associates supports clients in several arenas, including assistance with real estate-owned (REO) closings.
An REO property is lender-owned real estate that has defaulted and transferred back to a bank but has failed to sell at a foreclosure auction or a real estate short sale. In this situation, the bank is strongly motivated to sell the property to cover a portion of the outstanding loan. This gives buyers a rare opportunity to purchase a property at a deep discount. However, banks have little motivation to complete repairs on REO properties and leave them to the new owners.
Banks generally work with standard real estate agents to move REO properties, but in some cases, may seek the help of REO specialists. Nontraditional lenders, government entities, and quasi-government entities may also control REO properties. Lenders repossessed nearly 43,000 properties through foreclosures in 2022, a 67-percent increase from 2021 but a 70-percent decrease from 2019, with 143,955 foreclosures.
