Forums » REOs » REO regulations

REO regulations 7 posts by 4 users

Norm S.

Real Estate Investor
Jenkintown, PA

Posted: 06/14/2008 at 06:13AM

Hi everyone! New on the block. Have enjoyed all of your info.
Are there regulations that dictate how long a bank can hold a property or how many it can have at any given time?

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Kyle G.

Real Estate Investor
liberty township, OH

154 posts

Posted: 06/14/2008 at 08:07AM

how can the government regulate how long the banks can hold a piece of property they own? Now if you find a formula that will tell everyone how long or how low a bank will go on a REO then sell it, because you will be richer than bill gates

Norm S.

Real Estate Investor
Jenkintown, PA

8 posts

Posted: 06/25/2008 at 04:42AM

I thought I read that banks must keep a fixed dollar amount liquid for every dollar of bad debt. If so does this impact their abaility to lend.

Jon H.

Real Estate Investor
Denver, Colorado

Moderator

3875 posts

Posted: 06/25/2008 at 09:02AM

REOs do affect a banks ability to lend. A performing note is an asset. A non-performing note is a liability. A REO is a liability. The more REO's on a banks books, the more reserves they must keep in place and the less they can lend.

Norm S.

Real Estate Investor
Jenkintown, PA

8 posts

Posted: 06/26/2008 at 05:05AM

Thanks Wheatie, good information to pair with DOM.

Paul C.

Banker
Scottsdale, Arizona

308 posts

Posted: 06/26/2008 at 11:18AM

We have REOs in our inventory over 500 days listed! I don't think there is any regulation or timeline that the bank has to adhere to for REOs, but the only reason I couldn't see a bank liquidating an REO asap is because it is under some sort of lis pendens.

Norm S.

Real Estate Investor
Jenkintown, PA

8 posts

Posted: 06/26/2008 at 12:02PM

Is that not uncommon for you to have properties near the 500 day mark? Anything unusual about them that they sit that long?
Thanks,

Norm Swansen