OfflineWe're working with REOs in Central Virginia, and keep running into the same situations w/our offers.
We're working with REOs from our RE agents' MLS listings as well as with community banks. We're often finding that the sellers won’t consider offers unless they’re at or near list price (3% below), even on older listings (90+ DOM). These banks aren’t motivated to deal, even with "reasonable" offers. There's too much time and paperwork involved for them to be so laid back.
We’re working w/SFH to $150K. Most REOs that we’ve gotten through our RE agents or community banks don’t have large spreads between list price and FMV, esp since aver selling prices are down. The ones that do have great spreads need lots of work, so repair costs eat up the profit margin. Have even had cash offers turned down since some banks wanted owner-occupant offers only - no investors.
We're working w/other seller types, but most leads are coming from REOs. Any suggestions on how to tackle this?
Liz
If I read right. You want the REOs that need work because those are the ones you get at low prices. If you have your buyers list of rehabbers, you should be putting offers in on the REOs that need work becasue you can assign them to your buyers. Doesn't matter what the banks have them selling for. Take pictures of the damage to property. Explain why you offer is what it is. Get comps, bring anything negative in the neighborhood. Create a case for yourself to soilidify your offer. Have proof of funds, abililty to arrange a deposit agreement. Either get deposit from your end buyer or put up deposit then get from your end buyer when you get assignmnet contract signed with him. Either way make your offers, as an investor. Justify it the best way possible. Have your buyers in place to bring cash to the table so you can get closing set when your offer is accepted. Submitt offers on all the Reos you get. Why not? The best that can happen is you get 1 accepted. The worst they turn your offer down. Then you submitt another. No problem here, so don't make it one, make offers from a investors standpoint. If you are making offers on pretty houses. See if your investors also want rentals, buy and holds. You can offer a little higher for these houses on pretty homes that your investors want for long term wealth.
I got my mind made up.....
www.Kingjussinvestors.com
www.jussinvestors.com (buyers site)
But they don't work. Unfortunately your dealing with bankers and people who spend their days dealing with spreadsheets and P&L statements. They would not know a comp or a sheet of drywall if it hit them right square in the face.
Why are these banks so dimwitted about their short sales and owned properties? Two words, sheer ignorance. They're bankers not REI's.
All I am going to do is to keep making the same offer every month on the
30 day anniversary of the original offer. Maybe I will get someone's attention eventually.
Stan
When one sets out to take Rome, TAKE ROME!
Greatness courts failure.
are in the business of making money not buying & selling real estate. So, yes the number crunchers are clueless on how real estate investing works. All you can do is keep follow up with your offers. It usually takes at least 4 offers over 4 consecutive months before the banks says let's accept the offer.
KimmyJ
Press on...
www.tagteampropertiesllc.com
Kingjuss, this thread's about REO asset managers, and their impact on investors and RE agents.
Deal strategies are found in other threads. Thx.
Got that right, Stan!
One of my RE agents says the banks' lawyers have a lot to do with banks holding REOs (non-producing assets) on the books indefinately. Am told each sold prop eliminates billable hours the atty can charge to administrate it. Basically, he says the lawyers have their hands deep in the pot.
Your 30-day fol-up is a good plan, and a great way to build a banking relationship as well as close REO deals.
Thanks a lot, Kimmy. Find the decisions of some REO departments are both strange and amazing.
Most of our REOs are fr MLS. We're not dealing much w/local bank REOs, since many banks here say they don't keep an REO inventory. But will keep tabs on offers with those that do. Thx!
Liz
Liz,
Good grief Charlie Brown.
I really didn't think the attorney thing through but that makes sense. As long as they can manage it and string it along the better. I never met an attorney that could not wait to string something along and wait some more.
Stan
When one sets out to take Rome, TAKE ROME!
Greatness courts failure.
How many REO's offers are you making per week?
"If you cannot do great things, do small things in a great way.”
Napoleon Hill quote
You can't assign reo properties that you get under contract. If you can KingJuss, let me know how you are assigning bank owned properties.
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The comment on the attorneys holding up the sale due to getting their hands on more fees,etc. makes sense, I guess. We presently have an offer in on an REO and it has dragged on for while, considering it's a cash offer. The counter offer back from them stated they could close April 12th, but now I am not sure, since they keep asking for more info, EM deposits, etc. I'ts maddening because we just want to get in there and do the fix and flip. Waiting is the hardest part....
REO's can be assigned through double closings. I have completed 5 this year.
"If you cannot do great things, do small things in a great way.”
Napoleon Hill quote