Buying REO property or a foreclosure in Oklahoma City?
Just as with any home purchase, your smartest move is to hire a professional real estate agent.
For more information, just contact me
through my site or e-mail me
. I'm happy to answer questions you have regarding real estate foreclosures.
What is an REO?
"REO" means Real Estate Owned. These are homes which have gone through foreclosure and are now owned by the bank or mortgage company. This is unlike real estate up for foreclosure auction.
When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accrued during the foreclosure process. You must also be prepared to pay with cash in hand. Finally, you'll accept the property totally as is. That could comprise of current liens and even current residents that may require eviction.
A bank-owned property, on the other hand, is a much cleaner and attractive deal. The REO property didn't find a buyer during foreclosure auction. Now the bank owns it. The lender will attend to the elimination of tax liens, evict occupants if needed and generally plan for the issuance of a title insurance policy to the buyer at closing.
Take notice that REOs may be exempt from normal disclosure requirements.
For instance, in California, banks are not required to give a Transfer Disclosure Statement,
a document that usually requires sellers to disclose any defects of which they are aware.
By hiring Scissortail Residential Realty, you can rest assured knowing all parties are fulfilling Oklahoma state disclosure requirements.
Am I guaranteed a low price when buying a bank owned property in Oklahoma City?
It's frequently believed that any foreclosure must be a good buy and an opportunity for guaranteed profit. This isn't always true. You have to be cautious about buying a repossession if your intent is to profit from the sale. While it's true that the bank is typically eager to offload it fast, they are also motivated to minimize any losses.
Look closely at the listing and sales prices of comparable homes in the neighborhood when considering the purchase of an REO. And factor in any repairs or upgrades necessary to prepare the house for resale or moving in.
It is possible to find REOs with money-making potential, and many people do very well buying foreclosures. Still, there are also many REOs that are not good buys and may not be money makers.
Ready to make an offer?
Most banks have staff dedicated to REO that you'll work with when buying REO property from them. To get their properties advertised on the local MLS, the lender will typically hire a listing agent.
Before making your offer, you'll want to contact either the listing agent or REO department at the bank and find out as much as you can about their knowledge about the condition of the property and what their process is for taking offers. Since banks almost always sell REO properties "as is", you'll want to be sure and include an inspection contingency in your offer that gives you time to check for unknown damage and terminate the offer if you find it.
If, as a buyer, you can provide documentation demonstrating your ability to pay, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This goes for any real estate offer.)
Once you've presented your offer, it's customary for the bank to counter offer. From there it will be up to you to decide whether to accept their counter, or offer a counter to the counter offer.
Realize, you'll be working with a process that most likely involves several people at the bank, and they don't work evenings or weekends. It's not unusual for the process of offers and counter offers to take days or even weeks. Scissortail Residential Realty is used to working around the schedules of this type of seller and will do everything possible to ensure there are no undue delays.