Bulk REO Investing Basics

The weakness of the U.S. economy has given rise to the largest epidemic of foreclosures in American description. Yet well-funded investors in real estate are seizing upon this opening to profit from an profoundly profitable new chance.

This new chance – known as ‘Bulk REO Investing’ – is so huge it’s captured attention from wealthy investors and private investment funds alike.

Foreclosures are at the heart of the Bulk REO business, so let’s deliberate the foreclosure process.

To know Bulk REO investing is to know the foreclosure process.

As a home owner misses a payment or two, the lender sends the predictable barage of threatening letters and warnings. Subsequent a period of time single-minded by the lender, formal foreclosure proceedings start. The ‘pre-foreclosure’ time starts with filing of foreclosure red tape and concludes at public public sale.

Foreclosure is concluded when the property is place up for public sale. If the property is not bought at public sale, ownership reverts to the original lender. Such a property is then classified as an ‘REO’ (Real Estate Owned) by the lender.

Local real estate agents are usually used to resale REO properties at retail price to the all-purpose public. Though, lenders are increasingly willing to take much less than their REO asset is really worth. Lenders are willing to do so in exchange for the buyer’s agreement to buy a ‘package’ of REO’s rather than a single property.

The depression in the United States has yielded huge profits to real estate investors set to take advantage. The most thriving Bulk REO Investors will have a well-respected source of funding for their transactions. There are many sources of funding for these transasactions including: hard money and commercial financing, as well as non conventional sources such as hedge funds and private investors. Additionally, one man is becoming very well known in the field of bulk REO investing, and his name is Sal Bushemi of Dandrew Partners, a hedge fund in New York.