Bank owned vs foreclosure

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Bank owned-REO typically sold with clear title and title insurance.

Foreclosure auction-crap shoot, buyer beware, as far as clear title and liens.

This is kind of an obscure concept:

"foreclosure" refers to the reason why a property is up for sale (somebody didn't fulfill a financial obligation). "Bank Owned" refers to a status of ownership (kind of).

When something is foreclosed, the ownership is taken over by whoever the note or lien holder is / was - sometimes called "the beneficiary", or "the bank", but technically it is REO - which is a pretty vague term that refers to "real estate owned". It could be a bank, or a hedge fund, or a bond, or the US government, or a credit union, or an individual, or a LLC, or a corp, etc... Really could be any person or entity that held a note that defaulted.