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

The best way to find an agent that specializes in REOs is a few ways:

- Call local area broker offices and inquire
- Pick those free Home Magazine books and look throughthe listings
- Drive the area and note REO listings
- Some local real estate listing sites will let you search by foreclosure or short sale
- Ask another agnet to print off all foreclosures in a certain area and then you should also be able to determine the listing agent

I hope this helps. Good luck. Believe and Achieve! - Joe

I'm just reading Dean's latest book Your Town, Your Profits and I'm actually reading your story! Very inspirational!

Anyway, I want to find out..anyone can answer this:

"I am currently working with investors who want me to find properties for them where they can take over payments on that property. My question is..how do I make money out of that type of deal?"

Help soon!

Thanks!
Marizel

Yes If i am not mistaking they just pass a ruling about the 90days before you could sale property which would let you as and investor to assign or sale to a end buyer but i am not sure how long it's going to be in effect.

You may want to read Greg Murphy's Chapter # 4 about Lease Options. This is a great chapter that will provide pelnty of insight about the topic you discussed in the ablve thread. Good luck. Believe and Achieve! - Joe

Hi everyone, just getting started with the investing part of real estate. I've been a real estate appraiser in Florida for the the past 20 years and have now relocated to NY. I need a place to live and have found a great REO but have no credit or money. This is a 2 unit property that can help me pay the rent while I live in one of the units. The FMV is around $450,000 and the asking price is $198,000. I have all the info on what bank that owns it even the owners name, attorney, case #, etc. Who do I contact first and what kind of offer do I make them? Will they consider a lease option with $1,000 down? Thanks for the help.

I have been puting multiple offers (hundreds) on REOs recently and have been getting no response. My offers have been low but I can close in 2 weeks and yet I am getting nothing in return not even a counter offer.

I feel that my offers are not even making it to the bank. As a result I have researched the listings that I have made my offers on and found that the same three REO agents have these listings. I have googled these REO agents and will contact them in an effort to build a relationship with them. My offers will now be placed directly with them cutting out the middle man aka..the agent. I hate to go around other real estate professionals but sometimes you have to do what is best for you. We will see if this makes a difference in the response to my offers.

I am also going to try the strategy that is in Dean's new book "Your Town Your Real Estate Profit" on contacting the local banks in my area.

REOs present great deals and large profits. It is a shame that they are being handled the way that they are by brokerage firms and agents. As Buyers we must do what we can to obtain these deals even if it means that we must go directly to the source to get them.

In regards to REOs anything is possible and a bank can change their motivation on a daily basis. One of the keys include, the smaller the bank the easier and more flexible they will be on terms and conditions. Larger banks are a little less flexible unless you are making an offer through a conventional mortgage or with cash. I found that like anything in life, REO are handled by people and it is a people business. Therefore, it never hurts to ask or try. If you can get directly connected with the Asset Manager (or decision maker) you can be half way there! Another strategy I use is to make multiple offers at one time and see if you can feel out the motivation for the bank.

Reference my other forum post about REOs for any additional tidbits that may be helpful for contacting smaller banks in your area:

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

Another post to reference could be - Deal # 6 - Bank Provides 100% Financing on REO!..!....Dean Graziosi’s books, website and information made this happen!

http://www.deangraziosi.com/real-estate-forums/my-deals/23722/deal-6-ban...

Good luck with REOs, there can be some real gems just waiting for your offer! Believe and Achieve! - Joe

Thanks for the info. I will put together a list of local banks in my area. I am also going to contact the bank holding the property I want but do you think I can get 100% financing with no credit? I'm going to try that Deal #6 info and see what I can get.

Thanks,

You never know a bank's motivation until you try. The worst they can say is no. Each time you try a new offer or technique you may learn another tidbit to create your own niche for acquiring REOs. Good luck with the REO your trying for. Believe and Achieve! - Joe

Well, I would hope if they are an ethical REALTOR, they would not hold a submitted offer. The majority of the time with any listing, the listing agent is not the one who has the winning offer. Most agents know that they will be splitting commission on almost any deal they do and are fine with that. The object is to get it sold, get paid and move on. Some agents concentrate on listings; some are buyer's agents, and some do both, but an offer is an offer and should be submitted or they are not honoring their fiduciary responsibility to the seller.

(I'm not sure I originally posted this question in the right place, so here it is again):

I keep hearing about investors who make 20-30 offers on REO properties every week - they don't even go and look at them, they just make really low offers. What I'd like to know is, how do they know how much to offer without going and looking at the house and seeing what it needs. Is there anyone out there doing this sort of thing - I'd love some tips on how you go about deciding how much to offer without seeing the house. It seems to me that the end buyer would want as much information as possible about the house - or is that taken care of during the inspection period of the contract?
Thanks for the help!

can samebody help me on where to start I have very bad credit, i been looking on some REO's when i make an offer what , how if they accepted what do I do next can samebody help. what is a broker? I have heard about loas for people that don't have good credit how those work. please help

Ok, I have found a REO and I did find it on zillows.com but not on themls.com. I used the DG foreclosure tool to locate the home. It is 1500 sq ft and the FC tool says it is a 60k REO. I think I could run with this and make a good profit but I need to know what to do from here. Zillows says that it is not on the listing "01/29/2010 Listing removed" Please HELP, I want to know if I can move on this one quickly. Thanks DG Fam...

Joey

It doesnt matter if you have bad credit, or not. If you're wanting to make offers on properties all you need are the POF(Proof Of Funds) letter. You can get those from virtually any reputable lender. Here's one of many that will provide you with the proof of funds you need , as long as you're going to be doing a double-closing(You close with their money)and then walk to the next room and resell to your end-buyer for whatever asking price that you've established with them,(hopefully more that you're POF's loan...lol. www.coastal-funding.com

Just wanted to add some additional thoughts to the post. Whatever area of the country that you are in, you can have success with the REOs. Just try to determine the small locally owned REOs from the larger banks. The larger banks may eventually liquidate these REOs through an auction but still could be motviated to deal.

The smaller local community banks are, at times, more willing to deal. If you check your county records or treasurer's office (who mails the tax bills) it should reflect the current owner. A bank's motivation can change on a daily basis so make offers often. I found the smaller local owned REOs by little community banks can be more negotiable on rates, terms, price or even striking a deal. Just keep trying and you will be amazed at what you might be able to work out. Believe and Achieve! - Joe

Thanks for the information Joe, I do have a question though. If a house is foreclosed or listed on the tool that DG offers to locate a foreclosure, is it foreclosed or REO. I found the house using the tool and did some checking and even drove by. Seems that there are occupants still in the house but after some more research I found that the home was pulled from the listing (themls.com) back on 01/29/2010. What should I do at this point and what does all this mean? Thanks Joey

There are different points of the foreclosure process. Chances are the home could be foreclosed on by the bank but the people have not yet been evicted fro mthe property. The process sometimes can take banks several months or a year especially now because they are dealing with so many foreclosures.

I would recommend keeping an eye on this one (put it on your radar as I would call it). You could check the tax records and see what bank may own it, but if it is not a local bank there could be a backload of red tape. Thus, keep it on your radar and contiunue your search for other potential deals. There are so many potential deals that you always want to try to have a few to watch and take action on when the conditions are right. I hope this helps. Good luck. Believe and Achieve! - Joe

Thanks Joe that does make more sense and I will check out the tax records. It's definitely on my radar... Thanks again

Joey

thank you for the info maximilionalpha on the POF.

You're quite welcomed.

In Dean's book "Profit From Real Estate Right Now", he states that you can obtain a list of REO brokers in any particular state at the REO Network's website (www.reonetwork.com). Hope this helps!

My husband and I are every excited about getting started. We have found some great REO's and Foreclosure opportunities in my area. We are looking to buy these as a rental property or to flip, or mybe a little of each.
What is the best way to get going? Should I start a LLC first or put this under our credit? We have excellent credit. I am assuming we would put a bid in with the posting real estate agent, right? What else to think about?

Does anybody have a CHECKLIST to help get started on this adventure? IS there CHECKLIST as you move forward when working on a new bid?

In response to MyDestiny

You kinda threw me with your response as to what to pursue first, for the new investor. While I understand FSBO's and Assignments are the way to bring the quickest income. What I don't understand is, Why not a REO? Can you not apply the same principle.

You find a property they have and you like, you negotiate the price until an agreed upon price is reached, and instead of "locking the deal in", you simply pay cash (if you have the funds) or if the funds are there from a supporting investor; Just trust that person will cut you a check. Am I missing something? This is my very first participation in the forum. I've just completed Deanos book "Your Town Your Real Estate Profits".

My plan is to tackle REO's sent to me, and property I come upon for the purposes of "assigning" and receiving immediate payment. Is this the wrong approach for someone who is in critical need for cash and other very necessary items?

By the way...Are there any investors out there needing a "bird dog" for the Upstate region of South Carolina? I'll find satisfactory deals if you'll supply the cash. Look forward to your response.

I was recently online and found some information on a new way to purchase short sales.

According to the information I found, Old School Title Company formulated the method and works just like assigning a property but you double-close, without any obligation to purchase, instead of assigning the property to soemone else to purchase and you can make more profit. Currently, I am in the process of testing this method but you all would really benefit from this knowledge.

Here is the information on the program....
"The answer is using the option contract for your short sales and double closing!

Option Contract w/ Addendum
Gives you the investor the right to market and list for sale on the MLS and enter into a P&S agreement as seller. You can also counter offer back and forth with lender w/o getting sellers signature every time.

Notice Of Option
This is most important! 5 days after signed and notarized you must record this notice at the local county court house. This gives the investor equitable interest to the property. This prevents " Title Seasoning" issues and no break in the chain of title. (May need to change heading to �memorandum of agreement�

With this contract, nationwide title company, and funding you can double close properties legally and safely and never use any of your own money. The Title Company is know for it's " Blast" program.

This is the national solution for all of your short sale and foreclosure transactions and this title company is the creator of the nationally renowned BLAST� transaction; Buy Low and Sell Today! The BLAST� transaction is the method by which investors can buy and sell properties at the same time safely and legally. It is a program that is sweeping the real estate investment community and is being taught by the top real estate lecturers and coaches in the country.

" A" sells to " B" and " B" sells to " C"

who is " A" (seller in distress)

who is " B" (Investor)

who is " C" (End Buyer)

FHA will not fund on deals that seller has not been recorded as legal owner for 3-6 months (HUD Anti Flip Guidelines); therefore your " end buyer" on the " B" to" C" transaction can't use FHA financing.

If your end buyer is using FHA you may consider using the land trust."

here is a link to the contracts that make it work:
http://www.knoxrei.com/options

This all depends on the lender accepting the contract with those options not the title company. Many lenders these days will not accept anything but a buyer buying the property with no possibility of a second buyer. You can double close on a short sale using transactional funding. You can flip them right away providing the lender is disclosed to as to how much over the short sale price you are selling and the buyer has the same disclosure. This is for 0 to 14 days after you close, after 14 days no disclosure is necessary. My understanding is the FHA will fund if you meet those guidelines. Am I wrong?

Good Luck!
Michael Mangham
MD Home Acquisitions LLC

Having done both I have found working with REO's to be much more simple and straight forward.
1-No need to set up an appointment, just take over your Realtor who has the key code to get in.
2-Usually the REO home is empty and easier to see the real condition without having the owners personal belongings throughout the house.
3-When making an offer, you are only dealing with the bank as opposed to an emotional home owner (Not meant to be a negative, I would be emotional too if I were losing my house).
4-Submit offer directly to the bank via your Realtor. Make sure you know who the decision maker is, this could be a single person or a committee.

In my experience, REO's are a much cleaner more simple deal that messing around with all the possible liens on a home, the owner & multiple lenders.

I am a newbie just read the book and do not know where to start there are so many good deals where i live but my credit is trash have no money and don't know how to get started building my buyers list. Can you get a 100% loan on a foreclosed home through the bank with no money down and bad credit? And does any one have a letter they would not mind sharing to send out to FSBO and MLS that have been on the market for a very long time? I have placed adds on craigslist and e-bay but there are so many of them,and then you get other investors placing adds calling the other investors losers don't go through them i have cash now which makes your add look bad. I have sent out tons of letters and faxes to real estate agents but none of them want to help a investor especially one with no credit or cash. There are so many empty houses sitting around without signs on which bank to call, my husband does the up keep on the lawns on the homes but there is nothing telling you who to call and he does a lot of them. I really need some one that has already got of to a good start to take me under their wing and show me the ropes i am willing to pay a fee out of every home they help me with or split 50/50. I really need this to work before i am homeless. Some one please HELP!

Hi Kevin,

My name is Greg, Im a newbie in all this investing stuff. can you give me some direction ? Say do you know where I can get a sample copy of a purchase agreement where everything that you need on it is filled out..... They have blank forms but I sure could use all the forms I need to use have sample info on them all HELP!!

Thanks in advance

God Bless!!

Greg

Kevin

thanks for your suggestions and support

Regards
Tom

I'm working on an REO with my REA and she is asking for a EMD check to make the offer. who can I go about that while I don't have any amount to put down as EMO?. Please help me with this as I'm going to meet the REA tomorrow to sing the offer.