REO properties are kept by financial firm REO asset management department. It normally sold at a big discount (could be 30%) compare to market price.

Plenty investors are aiming for REO real estates to secure big money. Why? It is as a result of banks are forced to own these REO properties because of unsuccessful bid in a foreclosure auction, and banks usually anxiously trying to sell these properties as soon as possible and thus they are willing to sell it at a price that far less than market value. Sometimes the price is much below than what is owed on the mortgage.

Although most banks will have a REO asset management department, usually they will engage qualified realtor who specialized in this REO field.

Aside from the possible low price of the REO property, there are other benefits of buying a REO real estate than a foreclosed real estate.

The first biggest benefit is that you can inspect the property before submitting an offer to the banks. By doing so, you will have knowledge of how big is the property and evaluate how much money you required to folk out if the property needs to be fixed up after successful transacted to you. This is normally not possible if you are buying a foreclosure property in a foreclosure auction.

Secondly, there is not necessary to wait for the bidding to begin to start your offer as there is no auction date such as in the case of purchasing a foreclosure property. You could do this any day when you feel you are ready.
In addition, as there are a great number of foreclosure properties stacking up, the bank often will not ready to approve all this business deal within a short period of time. Thus you have pretty much time and a very big chance to reap many good REO properties from the bank's REO inventory.

Nevertheless, you have to take consideration that the bank REO asset management department in general will take several months to wrap a REO transaction. And normally you must pay your own money to renovate the REO property after buying as the bank might not sell it in good condition.

In general if you have done your homework properly and have chosen the property cautiously, buying and selling a REO property is a good investment that could make you a great sum of money.