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Buying REO property or a foreclosure in Oklahoma City?
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Foreclosed upon and bank owned property purchases require the assistance of an experience professional.
For more information, simply contact me through my site or e-mail me. I'm happy to address questions you have about real estate foreclosures.
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What's an REO?
"REO" is an abbreviation for Real Estate Owned. These are houses which have been foreclosed upon that the bank or mortgage company now owns. This is not the same as a property 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 amassed during the foreclosure process. The buyer must also be ready to pay with cash in hand. To top everything off, you'll get the property completely as is. That possibly will consist of prevailing liens and even current residents that need to be thrown out.
A bank-owned property, on the other hand, is a more tidy and attractive transaction. The REO property did not find a buyer during foreclosure auction. Now the lender owns it. The lender will deal with 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.
Do be aware that REOs may be exempt from normal disclosure requirements.
In California, for example, banks are exempt from giving a Transfer Disclosure Statement,
a document that ordinarily requires sellers to make known any defects of which they are aware.
By hiring Allied Inc. Realtors, you can rest assured knowing all parties are fulfilling Oklahoma state disclosure requirements.
Is REO property in Oklahoma City a bargain?
It's frequently thought that any REO must be a steal and a chance for easy money. This isn't necessarily the case. You have to be very careful about buying a REO if your intent is make money. Even though the bank is typically anxious to sell it quickly, they are also motivated to get as much as they can for it.
When considering the value of a foreclosure, you need to look closely at comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale.
There are bargains with potential to make money, and many people do very well flipping foreclosures. Still there are also many REOs that are not good buys and not likely to turn a profit.
Ready to make an offer?
Most banks have staff dedicated to REO that you'll work with in buying REO property from them. To get their properties advertised on the local MLS, the lender will typically use a listing agent.
Prior to 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 what they know regarding the condition of the property and what their process is for getting offers. Since banks most commonly sell REO properties "as is", it may be in your best interest to include an inspection contingency in your offer that gives you time to check for hidden damage and withdraw the offer if you find it.
If, as a buyer, you can provide documentation demonstrating your ability to secure financing, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This holds for any real estate offer.)
After you've made your offer, it's customary for the bank to counter offer. Then it will be your choice whether to accept their counter, or submit another counter offer.
Your transaction might be settled in one day, but that's rare. Since offers and counter offers usually allow a day or more for the other party to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer.
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Today's Rates:
| 30-yr Fixed | 3.87% | 4% | | 15-yr Fixed | 3.14% | 3.31% | | 1-yr Adj | 2.76% | 3.42% |
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