OfflineThis afternoon we closed on another REO property. It was a Fannie Mae that was listed about 4 months ago for 40K, it just sat there & after 45 days they dropped
it to 35K. It still wasn't moving, so we made an offer of 20K on it; the bank rejected it, no counter offer.
The property went to REDC Auction, we were high bidder at 20K (plus a $ 2500 buyers premium).In the past 4 weeks they changed their policy, any bid of $ 25K or less must be paid in full at the time of the auction. But the bank has 15 days whether to accept or reject your bid since it is not an absolute auction.
Anyway despite paying $ 700 in closing fees for the law firm's work, I had to email, scan, fax, & send the packet to the firm myself; but it is finally done.
The house needs about 5K to 7K in rehab & will be worth around 50K.
We have another REO closing in a week or two, hope it goes through ok.
Another REO Closing Put To Bed
Posted on: Mon, 08/16/2010 - 22:42
Another REO Closing Put To Bed
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- by gceriani
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I can see that when you get momentum there's no stopping you. Please keep posting, it's very encouraging.
That is so awesome! I love the auctions, but haven't been lucky enough for something I was watching to go on one. Putting in the offers is so tedious when working with the banks. You are doing so wonderful with your investing! Way to go!
Thanks for all the support. It's always a great feeling when a deal comes together, no matter how many you've done.Not Just knowing that you'll make some money, but having the feeling deep inside that no matter what life can throw at you, you can conqueror it.
Congrats on your latest deal! I have never bought a house at auction even tho I've attended some. That must be really exciting. Had you ever seen the inside prior when it was on the market?
www.adeptpropertiesllc.com
my story:
http://www.deangraziosi.com/node/10404
Yes, we previewed the property before. The listing agent called us about it prior to it going on MLS, it was listed at 40K. We knew its was too high, waited 6 weeks, they dropped it to 35K, they still had no offers so we offered 20K, they just rejected it. It went to auction 4 weeks later, we won high bid at 20K, plus $ 2500 buyers premium. Needs about 4 to 5 K for rehab, will be worth about 50K. Thanks again, Gary/Jill
I was wondering if you had to use your own money or if the bankfinanced for you? Congrats on your deal.
We always use our own cash when we buy, we seem to get better deals & quicker closings. Here in Fl. we can close in 3 days with cash since we deal directly the title company. We then rehab & flip the property. We have not wholesaled any deals yet.
Has anyone had experience with what Fannie Mae will accept (i.e. 70%, 75%, 85% etc of their asking price)?
Also, I've attended several auctions and hear horror stories of the auction company sitting on your payment even after the bank rejects the offer. Anyone experience this?
This house was listed at 39,900 with no offers for 1 - 2 months, was dropped to 34,900; still no offers, so we offered 20,000 ... Fannie Mae rejected it with no counter. It went to auction(REDC) & we were high bidder at 20,000.(There was a 2500 buyers premium.) So that's about 60 % of asking price.
Last year we bought a Fannie Mae that was listed for 59,000 & offered 28,000 ... Fannie Mae countered at 34,000, we countered back at 31,000, they accepted ... that was about 53% of asking.
Keep in mind these were cash purchases & closed with in 2 weeks.
As for auction companies holding your money, we never had an experience like that, but remember REDC now requires payments in at time of the auction for properties 25,000 or less ! Gary/Jill
We started to demo & got carried away ... decided to rehab to whole house.
We will spend a little more, but should be able to sell it quicker with everything brand new !
The best part was Lowe's had kitchen cabinets 20% off, deals on appliances,
18 months no interest/payments, plus Jill had a additional coupon for 10% off.
So after spending 4K at Lowe's, another 2K for carpet & misc. we'll have 28,500 into it plus holding costs, it will still be worth around 50K, but should sell quick. The best part is the house will be sold, & probably 2 or 3 more projects will be bought & sold before we even have to pay Lowe's.