Can I Use a Mortgage to Finance an REO Property?

Yes, you can finance the purchase of an REO property with a mortgage loan, just as you can for non-REO property. You could also factor the cost of repairs or maintenance required for the REO property into the size of the mortgage loan you intend to take out.

Note that because the home may be in disrepair, damaged, or otherwise in poor condition, the mortgage loan is considered riskier and less secure to the lender. As a result, mortgage terms (including interest rates) may be less favorable than if you were to purchase a non-REO property.

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You can also consider loans specifically for homes in need of repair, such as the FHA Section 203(k) loan as possible ways to finance your purchase of REO property.