Here is another new issue that is slowing down some of our transactions: “Squatters” in an REO. Lenders are now well aware of how difficult it can be to evict squatters, tenants or occupants of any kind from an REO. Therefore, if lenders become aware that an REO Property is occupied, many will not fund a purchase money loan until they have proof that the current tenants or occupants have vacated the property.
Please be aware of this if you are bidding on an occupied REO on behalf of a buyer seeking “owner occupied” financing; your negotiations need to include certain arrangements for an eviction of the tenants before close of escrow.
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 1197176, NMLS# 310167