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It's not your imagination -- there's been a surge in bank-owned homes this year.
According to foreclosure-tracking firm RealtyTrac.com, the number of bank repossessions climbed to a record level for the second straight month in May. More than 93,000 were repossessed nationwide.
Even as repossessions surge, the total number of foreclosure-related activities -- a sum of REO, default notices, and foreclosure auctions -- appears to be cresting. After falling for the first time in recorded history in April, activity rose by a meager 1 one percent in May.
The top-side of the Foreclosure Funnel isn't filling so fast these days.
That said, total activity still topped 300,000 for the 15th straight month and distressed homes accounted for 33 percent of April's home resales.
There's other noteworthy statistics in the RealtyTrac report:
In fact, there's even a trend among "foreclosure hotspots" toward lesser overall activity. Of the Top 10 metropolitan areas for foreclosure-related activity, only one showed an increase last month.
Areas like Las Vegas, Cape Coral-Fort Myers, Phoenix and Reno all posted declines.
The National Association of Realtors® says the typical "distressed home discount" ranges near 15 percent. That's excellent value if you can find REO in decent condition.
It's also reason for caution. Buying bank-owned REO in Cincinnati is different from buying a "regular" home.
First, distressed properties tend to be sold as-is and may feature defects that render them "un-lendable". Things like a bad roof, or faulty plumbing. Second, when you're buying a home from a bank's REO department, getting a "quick closing" is next-to-impossible.
You have to either (1) know what you're doing, (2) have a terrific real estate agent, or, most likely, both.
Furthermore, you have to know where to find "the deals".
If you're the DIY-type, each of these sites offer free, 7-day memberships to their respective foreclosure databases. After 7 days, you can choose to pay to extend your membership, or you can quit and pay nothing.
7 days can be more than enough time to find for what you're looking. Then, you can start the negotiation process.
Do your foreclosure research and see you like. Then, when you need your pre-approval letter, call meand I'll take care of it for you. I'm experienced with short sales and REOs and my bank can close loans quickly.
Plus, my bank offers financing for investors with more than 4 mortgages.
Dan Green (NMLS #227607) is an active loan officer with Waterstone Mortgage. Email Dan ator click to get a free, no-obligation rate quote.
You can also find Dan on Twitter and Google+.
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