Always be sure to conduct home inspection for the bank owned property. The previous property owner might have done something to the property that the bank is not aware of.

Usually, VA or FHA financing is not allowed on REO properties.

The benefit of purchasing a REO owned property would be the discounted prices these properties are priced down to. Lenders are in the business of lending money and will work hard to release properties that have been repossessed and or foreclosed on.

REO - Bank owned properties, can most often be purchased at a discount to current market valuations. Sometimes in really strong real estate Markets, this is not the case.

REO properties are generally sold "as is", so make you look the property over with a fine tooth comb if you are planning on doing any repairs yourself.

Bank owned properties are often purchased by real estate investors. Many REO houses require a lot of work by investors to be marketable. A handy first time home buyer can buy a REO requiring cosmetic repair and after some repair have instant equity in their home.