My suggestion would be, if you are seriously interested in acquiring property through these methods, to hire an attorney for an hour of their time and pick their brain. It will well be worth the money you pay to strengthen your knowledge. People make extremely ugly mistakes in this business. Best of luck.
Very truly yours,
Douglas Montgomery, Broker/Owner
Home NY Corp.
An REO property has already been foreclosed and the lender has taken ownership so you will receive clear title, free of any liens.