Presenting Offers on REOs - Property Listing Agent vs. Buyer's Agent

Yes, appraisal amounts can vary based on the appraiser. The appraisal is done at a specific point in time and can vary over time and the appraiser. With that being said, the various appraisers should all be close and in the ballpark. Also, you may want to ask your real estate agent to provide comps of all recent home sales for similar homes to the one you are looking at during the past 6 months to 1 year. Most appraisers will use comps of similar homes that have sold recently in the same local area.

Most appraisers do not use comps of more than 1 year old because the market may have changed. If there are no really good comps, the appraisers will go through other methods to determine the value. This is where their experience and judgment is really important. I hope this helps. Believe and Achieve! - Joe

Thansk for the sharing the information on llcs. Good luck with real estate investing. Believe and Achieve! - Joe

It is great you have an exit strategy in mind because that is key when lookign at any deal. The exit strategy can assist you with your offer as well. Good luck with gathering all the information and working to assign this deal. Way to take action! The information and knowledge that you gain in yoru local market will benefit you for many other potential deals. Believe and Achieve! - Joe

Thanks for the advice!

I'll keep you guys posted...

Rob

If the REO will need a lot of work most banks would probably want you to take a construction type of loan and then role it into a final mortgage product. The best thing that you can do is contact your local banks, or check-out their websites and look at the different types of loans they offer.

Then, you can call or email them with your questions such as rates and terms, money down, types of loan/mortgage products, etc. As you receive information you can refine your question list based on the information they provide. I hope this helps. Good luck with real estate investing. Believe and Achieve! - Joe

I have searched several REO's and have tried to make offers to the agent who is selling the propety for the bank. They always tell me they need cash up front for the entire sale. It seems unlikely they would ever be willing to go into contarct with me let alone give me 14-30 days to assign the contract. Is there any way of doing a deal with the banks or selling agent? or should I just work on preforeclosed homes instead? Thanks

Thanks for the advice Joe. Then I will be well prepaired when I go see them initialy.

You may want to try small local community banks that own REOs. They are a little more flexible on pricing and terms. I wrote some previous information on approachign local small community banks. The link is below for your reference.

http://www.deangraziosi.com/real-estate-forums/buying-foreclosures-reos-...

The larger banks usually want all cash buyers. You may be able to find an equity partner and pursue other REOs if you find a partner with cash in your area. Good luck with REOs. Believe and Achieve! - Joe

When you say "cash" you are you only referring to greenbacks/paper currency?

I have heard some people refer to "cash" as traditional financing which would include HELOC's and Mortgage's...

When I went to look at an REO property yesterday I never even thought of asking the listing agent if the bank only accepts cash.

Thanks,

Rob

Yes, to be clear cash and fast cash equivalents such as readily available funds from HELOCs and mortgages. The key is the ability to close quick with a strong offer may take preference over an offer that requires additional steps for non-conventional types of financing. Good luck with real estate inevsting. Believe and Achieve! - Joe

Do you have a Buyer lined up?

Do you have a buyer?

I just registered on this site. What a great discussion!
I wholesale REOs in San Diego, CA, and as we all know it is hard to get even an All Cash offer accepted. I have several buyers agents making offers 65-70% ARV depending on the zip code. Zip codes w/ high # of foreclosures are harder to resell so must get them at a lower price.
After you've flipped 2-3 deals with the same Listing Agent, then I move in to build my relationship with the REO Listing Agent. Before that you have not built credibility and they are too busy to return a phone call from ANOTHER investor.
REOs are not assignable so I do Double Closings. First and foremost find an escrow officer who knows how to disclose everything or handcuffs and jail are in your future.
My Team consists of agents, escrow officer, IT Guy, Contractor, Rehabbers, Buyers and my dog (he doesn't do much work, but still expects to get paid w/ food).
Teamwork is everything and makes life easier.

Interesting, REOs in San Diego are getting 25 offers a day, especially those under $300K. Many of the offers are Cash buyrs. You are lucky there is only 1 offer on the table. I'd follow up rapidly because that other offer may be a cash buyer. Sorry, I don't know any mortgage brokers in MI. Craigs List search may lead you to one who is searching for business.

Anyone got the inside info on how to make
the process shorter? Most say it takes any where
between 2-6 months, mostly the latter.

Thanx!

Has anyone experience/success in N.J. making an offer on REO's using a proof of funds letter from a transactional funding source and "and/or assigns"stated with the Buyer?

I have questions about how you get a REO from a bank under contract. What kind of contract are you using. How are you doing this with no money down? I live in Idaho and the REO's are all listed through agents. How long of a contract are you typically going to get the bank to committ to? One last question, there are a lot of seller that won't accept a offer with out prequalified financing, I have no money to invest and am trying to do no money deals how do you get around this, if you can?

Thanks, Brandon

I work with many REO companies in Southeastern Pennsylvania and know of no asset companies that will allow an 'and or assigns' clause.

Vince,
I take it you have tried? If not on REO's what about the pre-foreclosure's?

Also, do we use the true FMV to calculate from or do we use what the current market conditions say the FMV would be? For instance I saw a bank owned property whose tax assesed value is $400K, but they last listed the property for $200K - is in terrible condition, needs full rehab and is overlooking the water. What number should I be using to make my offer to the bank?

Tony, send me what you have - I may have buyers that might be interested.

Brenda

Hey Joe,I'm a newbie with one question. Is it possible to assign an REO property?

Anything is possible! When dealing with banks, if it is a big lender, you will make your initial offer. In your original contract, you will guarantee your right to assign. Now most lenders will send you a counter offer, basically re-writting your contract and calling it an addendum without changing your main points - purchase price, closing date. In there it will state that anything in this addendum supercedes anything that was previously agreed to. This may look good! But if you further investigate their counter/addendum it possibly will have a non-assignment clause in there, and if you sign the addendum you are agreeing that you will not assign this deal to anyone.

I hope that this information helps!

Hi..My name is Randy..I am located in Brooklyn N.Y.I face the same problem you have.Good credit but need a start.Let me know if you have learned anything that could help me.Thanks

OK I'm sure this has been discussed many times on some of these forums somewhere but I haven't found it yet.
I look up forclosures on the county Property Appraisers web site. It lists the bank it was last "sold" to but there is only an address for it and it is NEVER a local bank. I don't want to send letters to all these banks and I cannot seem to find their phone numbers. How do some of you manage to actually contact the bank or it's Asset Manager?

Welcome to the DG website community. The best types of banks to approach on bank owned REOs are the small local community banks of usually 5 branches or less in your local area. You can call and speak to the asset managers about the properties they may have available and work on establishing a contact at each of your local banks. I did a blog a few months back on "the Guidemap to finding REO Gems". I believe this blog forum may be helpful for you. Attached below is the link for your reference to this forum blog:

http://www.deangraziosi.com/real-estate-forums/buying-foreclosures-reos-...

Good luck with real estate investing. You can do it! Believe and Achieve! - Joe

Hi, I have just been presented with an short sale deal. The problem is I don't know what is required by the bank, can you do an assignment with an ss? I have not contacted the listing agent yet just need some feedback on how to handle it. I have in mind what I will be offering, and I will be going though the listing agent. Is a proof of funds letter required? What should I say to the agent, should they know that it would be an assignment?

A short sale is not an REO.
A REO is owned by the bank after the auction has taken place.
A short sale takes place in the pre foreclosure phase where the lender agrees to take less than what is owed them and it can take quite a while.
The lender will not allow an assignment of contract on short sales or REOs.This is true in my area anyway.
There are other strategies to use in these cases.

Good Luck,
Michael Mangham
www.mdhomeacquisitions.com

Thanks for the input and the insight. The great thing is their are more and more REOs the banks are now taking back so hoepfully they will start making faster decisions or losing qualified cash in hand buyers. Good luck with real estate invetsing. Believe and Achieve! - Joe

I'm not having any luck with Agents period. I would love to know how to find an REO Listing Agent. Thanks, bday