Ace the PSI New Jersey Real Estate Test 2026 – Unlock Your Property Power!

REO stands for Real Estate Owned, and this term specifically refers to properties that have been repossessed by a lender, typically a bank, following a foreclosure. Once a property has gone through the foreclosure process and failed to sell at an auction, it becomes the property of the lender, which then lists it as REO on their books.

This classification is significant because it reflects the lender's ownership of the property and indicates that they may be motivated to sell it at a competitive price in order to recover some of their losses from the initial loan. Understanding the REO process is beneficial for real estate professionals, as these properties can present unique investment opportunities and challenges.

The other options may sound plausible but do not accurately describe the standard usage of the acronym REO within the real estate industry.