REO Calculator
Calculate net recovery value for Real Estate Owned (REO) properties. Factor in repair costs, holding costs, and selling costs.
How it works
Net Recovery Value = Market Value - Repair Costs - Holding Costs - Selling Costs. This shows your net recovery after all expenses.
Example
$200,000 - $30,000 - $5,000 - $15,000 = $150,000 net recovery value.
FAQ
What is an REO property?
REO (Real Estate Owned) properties are foreclosed properties owned by banks or lenders after unsuccessful foreclosure auctions. Banks typically sell these to recover loan losses.
What costs should I include in repair costs?
Include all renovation expenses: structural repairs, cosmetic updates, HVAC, plumbing, electrical work, flooring, painting, appliances, and any code compliance issues.
What are typical holding costs for REO properties?
Holding costs include property taxes, insurance, utilities, security, maintenance, HOA fees, and financing costs during the renovation and marketing period.
What selling costs should I budget for REO properties?
Budget 8-10% of sale price for selling costs including realtor commissions (5-6%), title insurance, transfer taxes, attorney fees, staging, and marketing expenses.
How do I determine market value for an REO property?
Use comparable sales (comps) of similar properties in good condition, adjust for condition differences, and consider an appraisal for accurate market value assessment.