First-Time Home Buyer Q&A - Quicken Loans Zing BlogIn this post-2008-financial-meltdown world of ours, buying a home that the owner wasn’t able to pay for anymore has become a lot more common, and so have all of the different terms and options related to those sales: short saleforeclosuredeed in lieu and REO properties.

In this week’s First-Time Home Buyer Q&A Google Hangout, we talk about REO, or real estate-owned, properties – specifically how to buy one that is owned by the Department of Veterans Affairs (VA). But let’s take a step back first and look at what an REO home is.

What Does REO Mean?

REO refers to a home that the homeowner lost in foreclosure. If the lender who foreclosed on the home can’t sell the property at a foreclosure auction, then the lender takes over ownership of the home. The lender then tries to sell the real estate-owned property to minimize their losses.

Buying an REO home can be a good idea because they’re usually priced low because the lender wants a hassle-free process and hopes to create some competition between buyers. However, these types of homes often need repairs, and the lender usually won’t pay for any of the work because they don’t want to spend any more money than they already have on the home. So, you can get it for a lower price, but you might have to spend a lot of money fixing up the home.

Buying an REO Home

Because you’re dealing with an institution and a property that was taken in foreclosure, it can be more of a hassle to buy an REO home than one owned by an individual, and that’s what we cover in this first-time home buyer video segment. Someone was having trouble buying a home that was taken over by the VA and asked how to proceed. Mark Connors, lender liaison for the VA Loan Guaranty, says that if you’re having trouble, or just have questions when trying to purchase a VA REO property, you can contact him at Mark.Connors@VA.gov.

You can also watch the video here!



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This Post Has 50 Comments

    1. Hi Valentine:

      If you can get me the address, I can get it to our team to give you any information we have. I’m going to email you. Thanks!

  1. Hi-
    I am trying to purchase a home in Benton, AR that is owned by Quicken Loans. I’ve tried reaching out to multiple people with no luck. Can you help?

    1. Hi Betsy:

      I’m going to get this to our team and if we can share any information at this time, will be sure to get it to you. The sale isn’t necessarily handled by us, but often by the mortgage investor (FHA, Fannie Mae, Freddie Mac, etc.) and scheduled by the county. I’m going to email you for the address of the property and then I can get it to our team to see if there’s any info we have on the handling of the sale.

  2. There is a home in Sevierville, TN that the current owner is Quicken Loans, so I am assuming that it is a foreclosure. Can I get some information about purchasing this home.

  3. Hello Mr. Graham,
    Much appreciate the sources of information you provide to potential home buyers.
    I’m new to the REO market and very curious to learn more. Your help is greatly requested.
    Would you to please provide my name to parties that can offer their services to help me
    to find REO’s in the Clinton, Iowa area. Is there a list of REO homes available in this area?
    I have made plans to be in the area to view homes listed for sale. I want see REO properties too.
    My credit score is excellent and have adequate cash reserves on the side to help negotiate the sale.
    Please feel free to contact me. Will look forward to your response.
    Thank you for your time,
    Robert C.

    1. Hi Robert:

      The Department of Housing and urban development keeps a list of all the available REO properties in an area for for not only FHA, but also Fannie Mae, Freddie Mac, VA, etc. I hope this helps!

      Thanks,
      Kevin

  4. Hi, I was looking on Trulia and saw a property located in Mount Kisco, New York, which is a REO owned by Quicken Loans. How can I get information on that property in order to purchase it. As well as other REO Quicken Loans properties. Thank you.

    1. Hi JJ:

      The Department of Housing and Urban Development keeps a list of REO properties from a ton of sources. That’ll give you a place to start looking. You can get a preapproval online through Rocket Mortgage. If you’d rather get started over the phone, one of our Home Loan Experts will be happy to take your call at (888) 980-6716.

      Thanks,
      Kevin Graham

    1. Hi Ron:

      I’m going to get you over to our Client Relations team and they should be able to direct you to the right place. Thanks!

      Kevin Graham

        1. Hi Sharon:

          I’m going to get this over to our Client Relations team and they’ll be able to give you further direction. Have a great day!

          Thanks,
          Kevin Graham

          1. Hello, do you have a phone and email contact to sign up for REO property management and property preservation?

            Thank you

          2. Hi Sherry:

            Do you have questions on a specific property or are you looking to do property preservation? We have an internal team that handles our property preservation work, but if you have questions on the purchase of a specific property, I’m going to email you right now for the address. I can then pass that on to the appropriate team and someone will get back to you in the next day or so. Emailing now.

            Thanks,
            Kevin

    1. It’s easier in the sense that you don’t have to go through the process of applying for a mortgage. The downside is that you have to come up with all the cash upfront, which is harder to do.

      You can also get a preapproval extremely quickly through Rocket Mortgage. We connect the digital platforms you use to manage your money and you share some income and asset information with us. Then you pull your credit when you’re ready. The whole thing can be done in minutes and you don’t have to come up with the money upfront. If you get stuck on the way, we’re always here to help.

      Thanks,
      Kevin Graham

  5. Quicken Loans (plaintiff) just foreclosed a specific house in Oklahoma, which I am interested in purchasing… is there someone who handles Quicken’s REO properties to whom I could speak?

    1. Hi David:

      I’m going to pass your information to someone who can get you in touch with the right people. Thanks!

      Kevin Graham

    2. There is property that Quicken foreclosed on in Frankfort, KY, and everywhere I check they still own it. How do I see about purchasing this property and who handles Quicken’s REO property I can speak with?

      1. Hi Joyce:

        I’m going to get this to our client relations team and they should be able to point you in the right direction. Thanks for reaching out!

        Kevin Graham

  6. Hi,
    I am looking for some advice, my husband and I are moving back to the states from Australia, being young professionals we want to get our foot in the door and are very interested in seeking out REO homes to purchase. Is there a procedure for how to go about this process or is it negotiating with which ever company holds the title of the house? Thank you

    1. The bid and offer process for the major mortgage investors takes place online through their individual websites. The big ones are HUD for FHA and VA properties, Fannie Mae and Freddie Mac. You find the house you like and then put the actual offer in online. Hopefully this helps!

      Thanks,
      Kevin

  7. Hi I would like to know if I choose to use quicken loan to get pre approved
    does quicken loan offer down payment assistance to buy the home and would I
    be able to purchase a REO home with quicken loan?

    1. Hi Tangela:

      I’m going to take these in reverse order. You would be able to purchase an REO home. We do have a 1% down payment program with a 2% grant that functions like down payment assistance. We would need more information to know if you qualify. I’m going to recommend you speak with one of our Home Loan Experts by visiting this link or calling (888) 728-4702.

      Thanks,
      Kevin Graham

    1. Hi Edie:

      Unfortunately, we don’t do bulk lending. I’m not familiar enough with this market to tell you where you can find such properties.

      Thanks,
      Kevin Graham

  8. Hello, my name is Raquel and I am in search of a home. My credit score is at 576 and I have read in some of your responses that I need a 580 to qualify for a FHA loan. I also have no down payment any advise would be appreciated. I need a house ASAP. Is there anything I can do to make this possible.

    1. Hi Raquel:

      The only 0% down payment option we have is a VA loan. We do have down payment options that are low. They allow for as little as 3% down payment if you have a 620 credit score. It’s 3.5% if you just want to qualify for FHA at 580. Here’s a blog post with some tactics on building up your score. I hope this helps!

      Thanks,
      Kevin Graham

  9. Our daughter is a single Mom who lives in North Jersey. Her credit isn’t the best, but we are helping to get things in order. She is interested in being a home owner in about a year. The only way that would be financially possible is, we believe, with a REO. Would it be advisable for her to approach the banks in her area asking about REO’s, or to simply look online? Would a realtor be the way to go, or would that just add to the cost? We do plan on helping her with the downpayment and possibly have my husband on the deed, but the mortgage would be strictly in her name. Are REO’s eligible for mortgage? If not, what would her other options be? And finally, is there something other than an REO that she should consider? Thank you for your help.

    1. Hi Leenie:

      I’m going to try to take these one at a time. You don’t have to approach any bank to look at REO properties. Fannie Mae, Freddie Mac and the Department of Housing and Urban Development all have website listings. Whether you need a real estate agent ultimately may come down to your comfort level, but real estate agents do tend to know the market in your area and can help you find a house that meets your daughter’s needs easier in some cases. REO properties are eligible for a mortgage. Finally, she may have other low down payment options that don’t involve REO properties. I’m going to have someone reach out to you to go further into your daughter’s situation and any options she has.

      Thanks,
      Kevin Graham

  10. Hi I am a Veteran with a C.O.E,, a credit score of 650+, have a good monthly income, from V.A.D. and S.S.D.I, also attended First Time Home Buyer Class and have my certification good for one year. R.E.O. Homes in Ohio for 30 year my Dad ran a remodeling company, so fixing up a place is not a problem, I’m confused on which way to go, buy out-right V.A, no money down, Rent to own option, or go REO, problem,is reo home will not qualify for a mortgage, I’ve been in quite a few, and as you stated a lot are run down and the lender don’t even want to invest in the property, I was told a house of this nature has 2 factors to look at, (1. is the house sound – cracks, broken windows, roof leaks, or about to collapse etc. 2 is the property safe, sinkhole,flood zone, exposed wiring, no plumbing, this is the first thing the inspector or appraiser is going to look at, he reports back to the lender yea or nay, and these people have to be paid for their services, so guess who pays, I’m stuck on which way to go, I’m ready looking for a good dream, not a nightmare! Help!!!!!!

    1. Hi Benjamin:

      I’m going to have someone reach out to you and give some advice on this. Thanks for reaching out!

      Kevin Graham

  11. I would like to buy a REO.. Plenty in my area..credit is 565. Cause if oilfield slump… Husband and I would like to start flipping properties. Need our foot in the door. How do we do this. Have No Money of Our Own..Just want a Home.. Lost twenty years of retirement with Enron. Thank You.

    1. Hi Sherry:

      Sorry to hear about your retirement fund. Regarding getting a mortgage, you’ll need to get your credit score up to 580 before you can be approved for an FHA loan. You’ll also need some money for a 3.5% down payment. There’s a potential for that to come from other sources, but the down payment is something to keep in mind. I’m going to have someone reach out and go over this with you.

      Thanks,
      Kevin Graham

  12. Hello my name is Kathy and I live in SC, Single mom for 20 years now, I still have my baby of 4 still with me. Several years ago I had to stop working due to my back”Shriners did my surgery” but of course I was turned down for Disability & they put me on SSI !!! Anyway this past year I was diagnosed with Huntingston that my dad had, again even tho’ there’s no cure or treatment there’s nomore financial help. I’would love to have a HOME that’s MINE now I just have no idea where to start. Please help because my rent is killing me & I see so many homes that I would love to call HOME !!!

    1. Hi Kathy:

      I’m very sorry to hear about your medical situation. I can put you in touch with someone to help you look into your options. They’ll be reaching out.

      Thanks,
      Kevin Graham

  13. We are a young family looking to buy our first home. I see hundreds of REO foreclosed in my area and was wondering if this is a good option for us. Unfortunately we don’t have great credit but we could make a reasonable down payment. I have been doing research and would be so grateful for more information.
    Thanks

    1. Hi Jacquelyn:

      REO properties are definitely an option. One thing to consider is that to get a mortgage, you’re most likely going to need a credit score of at least 580, but I’m going to have someone reach out to you with more information.

      Thanks,
      Kevin Graham

  14. already live in a REO Property, which was first a reverse mortgage to my now deceased mom. The reverse mortgage was processed in 2007. My mom died in 20012. I was pre-qualified to purchase at short sell in 2013. I was denied due to problem with getting on title. Later on finding out that my sister was still on the deed and was forced by an attorney that represented the reverse mortgage to sign deed over to the bank. Or she would be responsible for the mortgage and stated that they will garnish her wages. My sister explained to the reverse mortgage rep, that she had no knowledge of her name being on the deed, for she had already sign a form from the reverse mortgage to take her name off of the deed. after being harassed by the bank’s rep., she felt forced to sign a ratification form to sign over the deed. ( in 2013) Which later was found to be fraudulent according to a law firm that was representing her case. Unfortunately my sister ignorantly file for bankruptcy during this investigation. She filed chapter 7 which of course put in the hands of the trustees. At this point the reverse mortgage rep. settled for 50,000 dollars. P.S. I’ve been living in this property for over 30 yrs. Which was bought and owned by my now deceased parents; until my mom decided to get a Reverse Mortgage. And just recently my son who lives with me is now paralyzed. How can I keep this property

    1. Thank you for your comment, Teace. I’m going to have a home loan expert reach out to you with an email. They’ll look at your situation and see what we can do.

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