Guidemap to finding REO Gems...let the adventure begin!

Hi Jason

If you own the other house out wright why not get a line of credit, so when you make your offer it can be a cash deal. And you will have your proof of funds at the same time. That will put you in a better position, so you can make a lower offer with strength. The bank mite except your offer quicker. Just my opinion.

Jim Kendrick

........As Jim indicated above you could try a line of credit against the home you alreadfy own free and clear. Another strategy could be to get a mortgage on the home yo own free and clear to free up some cash. That way you can also make agressive cash offers on proeprties and be able to close abnd act fast on deals. You may even approach the bank on attractive financing on teh REO if the REO is ownbed by a small community bank. I hope this helps. Goodl uck with this potential deal. Believe and Achieve! - Joe

this is awesome. i will be able to apply this

...Welcome to the Dg website. The site is packed with so much great information. I am glad you foun this information useful. Good luck with real estate investing. Believe and Achieve! - Joe

Hey guys! I followed IndianaJoe's advice on calling different local banks around my target area and I got 3 good ones on Thursday. Since it's Christmas weekend I will have to wait til' Tuesday to really get in contact with the Asset Managers again. My goal is to see if I can find a good property that needs little repair and ask the bank to not only accept my low offer but to finance the house, give me 3 months before I make my 1st payment on it so I can find a tenant, and 5k at closing so I can fix it up as well. This will be my 1st time attempting something like this but I have seen a couple of Dean's students who have done this and has worked for them. Does anyone have any pointers I can quickly digest on this subject? Any feedback would be appreciated. Thank you and Happy Holidays everyone!

Thanks Joe you always help steer us in a great direction. Have a great day and let's take action.

....Congratulations on taking action by contaqcting the banks. The best advice is try to establish rapport with each bank contact. Listen to what they have to tell you and then communicate your offer. Each offer can be a great learnign experince to assist you with your next potential deal. Good luck with potential REO deals. Believe and Achieve! - Joe

.....Thanks for your input and comments. It is true that action can lead to results. Goodl uck with real estat investing. Believe and Achieve! - Joe

I think you will do better with Banks in your area. One thing to remember is to make sure you ask for their extension when you are transferred all over a bank. Often times the asset manager is different locations. You should ask for their phone number then as opposed to trying to find them later a couple of states away.

its funny that I just ran across this, I was planning on going out to local mini banks in the area tomorrow to do some canvassing in person and open business accounts with them and weave the asset manager into the discussion.

This is what I have done before.

-Go to the bank
-Sit in the chair and wait to be called (make sure you are dressed like a million bucks!)
-When they ask what they can do for you tell them this "I am a real estate investor and we are doing a lot of business in the area. Having an account locally would save us time when dealing with our investments in the area. I was wondering if we could sit down and talk about the different types of business checking account that you offer so that I can see if they may fit for my business needs.
-they will walk you back to a cubicle or office at this point if your not already there
-talk about the account and the benefits and fees and such and ask them what the require to open the account as far as paperwork and deposits blah blah blah
-Politely advise that you are thankful for the information and need to discuss it with you partner and gather up your required documents that are needed to open the account.
-just when the meeting is about over and the account discussion is done and you are about to shake hands and say thanks THEN YOU SAY!
-"Well this does sound like something that we may further pursue but while Im here do you know if you have any bank owned properties that may be available for purchase?
-their eyes will light up with glee and they will say...Yes let me introduce you to (the asset mgr, or branch mgr) If you get a no, hes not here or shes not here...ask for the contact information and when they are avail to chat.
-at this point you should be sitting with the Asset Mgr or Branch Mgr and in a happy discussion about how you may be able to help the bank get some of these properties off of their books.
-now you are set and you can do anything you want from there.
-if the asset mgr is not avail at the branch, ask to be introduced to the branch mgr anyway as part of your decision to open an account...then discuss your interest in the REOs and on your way out ask the branch mgr to email the Asset Mgr and give you a call because you will be on the road all day and would like to initiate contact with them asap to discuss business.

keep in mind this took $0.00 dollars...you are in person, and you look like a million buck, and you never got a voicemail and there is no change to get disorganized and not know who you are talking to! THEY WILL TAKE YOU SERIOUSLY!

LET THE NEGATIONS BEGIN!

I hope someone actually goes out and tries this!!!!...this took a long time to type up lol....it works...I do it all the time....I find that its a better first impression than a phone call.

But more so ...I hope you try this so you can come back and tell everyone how awesome you were and how great the experience was.

Make sure to leave your card behind with everyone you speak with at the bank! They might call you for personal related solutions that they need your help with outside of the banks walls!!!!!!!!!!! It happens!

Thanks for putting this up, its exactly what I was looking for...Have a great week!

...There are many local community banks out there that are ready to wheel and deal. You never know what you might get unless you ask. Good luck with your pursuit of these bank owned REOs. Believe and Achieve! - Joe

Thanks Joe

I have been running this question by people this last few days about whether you can get better deals or cooperation from the local banks or the big national/global banks. On one hand I thought the big guys might have a corporate level Loss Mitigation VP handling all their REOs and not knowing all the local markets around the country may be more likely to undervalue some properties. On the other hand the local banks don't have the big budget cushioning them to help absorb the impact of all those incoming REOs.

So now thanks to you Joe I know I'm better off with the local banks. I know you would be the one to ask, and I should have thought to ask you first.

Major thanks Joe

Oh and to Bernard

IT's also funny you should have made this posting when you did because I am in the market for a business checking account. So I was going to be visiting or calling some banks anyway. Now I will be sure to squeeze the REO subject into conversation and accomplish the actual main objective (asset mngr) while reconing the banks for the checking account info.

Good Timing and Thank You

Steve

Very informational.

...Good luck with real estate investing. I am glad you found the posting helpful. Each day we can learn something new to help us to go further with this business. You never know what deals are just a phone call away. Believe and Achieve! - Joe

Joe you are definitely right. It's incredible how much info you can get just by picking up the phone and calling the local banks.

a&s

....Good luck with REOs. The opportunitites are everywhere. Believe and Achieve! - Joe

Hi Joe,

Let me start by saying I think your willingness to help others with your advice and seeing your path to success is fantastic. You always seem to have a smile in your voice!

Anyway - I'm a student in the success academy and am heading into the world of REO's and find your approach easy to follow and motivating. Thank you.

I am ready to make offers in a small town in PA with small banks and was wondering if I am having my agent submit the offers should I draft a letter stating what term I want for him to forward?

And #2 - Have you had experience with smaller banks financing the REO's? I was under the impression you couldn't get financing on REO's?

Thanks again for all the invaluable advice!

Thanks so much Indiana Joe for your awesome insights.

Question?????

When making an offer directly to the bank does it make a difference if they refer you to the listing agent?

Would I need a realtor to draw up the contract if i deal directly with the asset manager from the bank??

Any suggestions would be greatly appreciated.

Esmirna Maloon
www.mernasellsyourhousefast.com
www.mernabuysyourhousefast.com
www.countyhousehunters.com

Keep it up

...The small local banks and credit unions may offer 100% financing on REOs. You need to work on cultivating relationships with these local type of institutions and then propose a win-win transaction that include financing.

Some banks will work directly withg you while others will refer you to a real estate agent. The key is to ask the banker if they want you to make an offer directly to them or through the agent. The bank will advise what they prefer. Good luck with REOs, I hope this helps. Believe and achieve! - Joe

You can work directly wuth th realtor the bank referes to you. If the bank is willing to work directly with you, you can have an attorney assist you with the contract. The key is establishing a good relationship wit the asset manager and seeing where that leads to. Good luck, I hope this helps. Believe and Achieve! - Joe

Thank you very much for sharing great information. I've also read your section in Dean's "Your Town Your Real Estate Profits" and started calling a few local small credit unions. I was able to reach the person in charge at one of them and she gave me some information on REO property they just took it back!!

This really works!!

My partner, who is also my husband had ran some ghost ads on Craigslist to see if there is any interest and we got some responses, too! This is all great!! But I have a question here...some wanted to know the address and others wanted photos of the property. We haven't even have this under contract. How would you answer to them in a case like this?

If I may ask one more question....I want to assign the contract to a cash buyer. Would you tell the bank that you are going to assign? I would appreciate if you could give me some suggestions and advise.

Thank you so very much!!
Naoko:)

Hi Joe

I know lots of gurus and such advise going after REOs that are fresh and not yet listed, thereby avoiding competition and the dreaded LA's commission. On the other hand some people say it's the older ones that they are more anxious to offload and have cost them more money from sitting on them for years.

My question to you is do you find that there is one philosophy that holds more true or that you are more able to get a low offer accepted on?

Another thought I have when looking at listings from a couple years ago is "Why has no one bought this"? "Is it just a problem property or does the bank just turn down every offer because it's too low"?

Any thoughts you have on these are greatly appreciated.

Thanks
Steve

From reading the Your Town Your Profits book, I found that if you are running some ghost ads that you would just tell the potential buyers that you always have properties coming through. Your goal is to simply get their contact info and criteria and put them on your buyers list.

Exactly ruevanspro, the ghost ad is actually phony. that is to say the advertised property is just a made up one based on a typical deal that most investors would want. The intention is to gather their criteria they are looking for in a deal and write all this down so you have a file on that buyer. My buyers list is a 3 ring binder with a 2-page file on each buyer.

Now you could use an actual property you are considering for this ad. This way you can fish for a buyer and if someone is interested just tell them that one is sold but you are looking at another similar that they may be interested in.

When people told me I should list pics, address and such, I just told them I don't normally list them at all as I just call my buyers on my list and sometimes I don't get an immediate response so I post it on CL to get it sold. Then I discuss with them their criteria and strategy and add them to my list as well.

I was thinking about how I could search for REO's at local banks only and weed out the big guys.

Do you know if an agent can search the MLS for REO's belonging to a specific bank or credit union?

As always I really appreciate you sharing with us.

Thanks
Steve

Hi there - My chosen real estate investing strategy had been to wholesale to generate some initial cash funds and reduce our debt before then moving on to getting cash flowing properties. Every vacant home I find turns out to be a REO. So, my quesiton is, how do I wholesale REOs? It's my understanding that I cant put "and or assigns" on a REO offer. I have buyers, I have properties, I'm unclear how to join the two and make some money. Thanks for your help

....It is good to run ghost ads to gauge the interest of the particular property. I would not share the address or pictures until you have the property locked up under contract. The ghost ad works good to gather intrest then after you lock up the deal you can re-run another ad. I would not tell the bank you want to assign the deal. Some banks may want to just deal with one buyer. Thus, you may have to do a double close. I hope this helps. Good luck. Believe and Achieve! - Joe

...You raise many good questions and I believe each bank is different and we never know what motivates a bank. I believe limited competition is good and I believe a property held a long time may be a motivating factor. Other things that motivate a bank is quarter end or there fiscal year end. Maybe the bank is going through an upcoming audit. The key is make many offers on various REOs. A bank's motivation can change on a daily, weekly or monthly basis. Good luck. Believe and Achieve! - Joe