Before you Buy that Foreclosure, Please Read This!

Mr. and Mrs. Consumer, before you buy that foreclosure, please read this!

The Facts:
Time: 10:00 p.m.
Place: Title Company, Owasso, Oklahoma

Participants: First time home buyers, Realtor, Closer(s)
Purpose: Final closing on foreclosed trailor

Yes, you read the facts right. We were sitting at a closing table at ten o'clock last night, finally signing papers on a foreclosed, double wide trailer sitting on 2.5 acres. This was a month past the original closing date, by the way.

Was it a good deal? Price wise, yes. It sold at $70,000. Not bad for 1500 square feet in a flipped double wide with that much property. It also included the fridge, washer, dryer, stove and dishwasher. All were practically new.

But if you think getting a steal of a deal on a foreclosure property is easy, at least in Oklahoma, please think twice. Here's why...

1. We have many investors in the Oklahoma housing market who were buying distressed properties before the housing market crashed. They are professionals. They know what they're doing. They're good. Some of them even have their real estate license specifically for this purpose. In short, they'll beat you to the good stuff almost every time. This can make finding a good deal very difficult and frustrating. This is why you're mostly going to see left over junk if and when you go look at foreclosures.

2. Foreclosed properties are sold "as is, where is." That means that the seller will not pay for any repairs. For this reason, you MUST have the property inspected. That means you're putting around $500.00 on the table to find out if the home is even structurally sound or suitable to live in. Don't want to spend that much money on something you're not sure you want to buy? Then don't buy a foreclosure!

3. Foreclosure properties can and often do have title issues. In our case, there was a lost title. Once that was located, there was an issue with whether or not the title had ever been released from the Oklahoma Department of Motor Vehicles. It took the entire day for lawyers and title companies to settle that problem. Title problems are not guaranteed to happen with foreclosure properties, but don't be surprised if they do.

4. Some banks are getting smart. We're seeing them actually go in and "flip" properties now. This is what they did to this double wide trailer. They put in new carpet throughout, new paint on the inside interior and replaced the entire front wooden covered porch. I showed a "flipped" house in our town this summer that was in foreclosure. By the time we got there, I was the 9th Realtor to show the house. When I submitted our offer, it was the 5th one on the table. My people didn't get the house.

5. Finally, in dealing with foreclosures, you deal with often unseen people. While the property might be in Oklahoma or whatever state you live in, you could end up dealing with underwriters and other people in other states. The process can move painfully slow. They often require a mountain of addendums that basically say you are the buying the property "as is" and that you have to close at such and such closing company and if you don't close by the closing date that you're gonna have to pay them $100 per Diem. That means they want to charge you a hundred bucks a day if you don't close on time. Uh, hello, real sellers don't pull that kind of garbage on their buyers.

So, if you really want to play in the foreclosure game, get ready, cause it will be a bumpy ride. You might get a good deal at the end of the day. But the process of getting that deal is gonna cost you big in terms of frustration and emotional exhaustion.

My advice is to buy something nice from a real seller. You just won't believe how much fun it can be to work with real people and nice houses!

For the most complete information on the Owasso and Greater Tulsa Oklahoma housing market, be sure to check out www.BobHaywood.com

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