[quote=AN] . . . Overbidding against yourself is still overbidding. In a blind auction, buyers have no idea how many real buyers are out there competing for the same property. Maybe the seller agent is just very good at making the buyer and buyer agent think that there are 20 other offers out there and to get them to go higher.[/quote]
AN, I think this is the case more often than not. I would never engage in a “bidding war” and would WALK if I was given a story by the listing agent of having recieved “numerous” or “several” other offers or told “other offers are coming in.”
My first offer is or very nearly is my highest and best offer. I have always written purchase offers clean, unless there was lis pendens on title for the seller to clear (2x this has happened to me, personally). If I don’t get a counter-offer or rejection within 72 hours, I WALK. Only one time did I wait four days until Sunday when all the bids would be reviewed by the seller (who had been out of town). My bid was rejected and I had my answer.
These same principles applied when I acted as a buyer’s agent.
If I found myself trying to purchase or represent a purchase of an REO today, I would NOT put up with a bank’s drawn-out shenanigans. I would write an offer to be valid for five business days only and expect an acceptance, counter or rejection by then. If not, move on.
I would NOT make an offer on a short-sale myself or steer a buyer I was representing towards a “short-sale” listing as I feel they are a HUGE waste of time and energy, for both buyer and seller and don’t really help the seller much, credit-wise.
I want to clarify that I would insist my buyers had a COMMITMENT letter signed by an underwriter for up to a certain loan amount and place that letter in the offer, so they would be very strong in the event of an all-cash offer. I know this gives away the max amt. they can qualify to borrow to the seller’s agent, but I don’t care. It in NO WAY MEANS that they are WILLING to borrow that amount for *THIS* PROPERTY.
In the past, I coached my buyers to go to a “direct lender” and frequently accompanied them at the time of application and reviewed all their comm. from lender with a fine-toothed comb. I never tolerated lender or escrow shenanigans, either, including 11th hr. closing surprises, screwing up payment due dates & terms, phony escrow “amendments,” walk-thrus where the items requested were not completed, last-minute “liens turning up,” etc. If the docs aren’t redrawn for free, we WALKed. If the items requested are not finished on the final walk-thru after ample notice, we WALKed. If the seller doesn’t have enough proceeds to pay the lien(s) and can’t pay them, we WALKed. If the lender comes in with a *new* back-end “trash” fee + pts. + orig. fee + loan fee, etc. we WALKed.
Call me a control freak if you wish. IMO, if you don’t make your intentions and requirements crystal clear from the moment you sit down and write the FIRST OFFER on a property, the other parties in the transaction will more than likely WALK ON YOU! Caveat emptor – it’s a minefield out there! He/she who votes with their feet sends a strong message.
Note: I have never represented FHA or VA buyers, only VA sellers (helped them get their Stmt. of Eligibility back). Thus, the buyers I DID represent had substantial downpayments. I don’t know if the WALKING mindset would work with low or no downpayment buyers, because they aren’t in as strong of a position.
What ever happened to the buyer’s agent getting in front of the seller(s) THEMSELVES in person and presenting their client’s offers – properly. Has that practice gone out the window??
I still believe a buyer’s agent should advocate in all areas for an inexperienced buyer but many seem afraid to or don’t know how.
