Interested in REO property or a foreclosure in Edmond?
Foreclosed upon and bank owned property purchases require the assistance of an experience professional.
Should you have questions about real estate in Edmond, Oklahoma, call us or send us an e-mail.
What's an REO?
"REO" is an abbreviation for Real Estate Owned. These are houses which have gone through foreclosure that the bank or mortgage company presently holds. This is unlike a property up for foreclosure auction.
If you buy a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accumulated during the foreclosure process. The buyer must also be prepared to pay with cash in hand. To top everything off, you'll accept the property completely as is. That possibly may comprise of standing liens and even current denizens that need to be thrown out.
A bank-owned property, by contrast, is a much cleaner and attractive proposition. The REO property didn't find a buyer during foreclosure auction. The lender now owns it. The lender will handle the elimination of tax liens, evict occupants if needed and generally arrange for the issuance of a title insurance policy to the buyer at closing.
Take notice that REOs may be exempt from typical disclosure requirements.
For example, in Texas, it is optional for foreclosures to have a Property Disclosure Statement,
a document that typically requires sellers to reveal any defects they are knowledgeable of.
By hiring Castles & Homes Real Estate, you can rest assured knowing all parties are fulfilling Oklahoma state disclosure requirements.
Am I guaranteed a bargain when investing in an REO property in Edmond?
It's sometimes assumed 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 REO if your intent is to make a profit. Even though the bank is often eager to sell it fast, they are also motivated to minimize any losses.
When contemplating what to pay for a foreclosure, carefully analyze 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.
The bargains with money making potential exist, 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.
All set to make an offer?
Most banks have a department 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 frequently contract with 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 their knowledge about the condition of the property and what their process is for getting offers. Since banks typically sell REO properties "as is", it's often prudent 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 showing 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 make a counter offer. From there it will be your choice whether to accept their counter, or make another counter offer.
Be aware, you'll be dealing with a process that most likely involves multiple people at the bank, and they don't work evenings or weekends. It's not uncommon for there to be days or even weeks of going back and forth. Castles & Homes Real Estate is accustomed to these situations and will work to ensure there are no undue delays.