REO sale at less than our offer

[SD Realtor]

That has nothing to do with it. You mentioned that you have an aversion to reos or short sales that are not listed generously under market or something like that.

At trustee sale, the properties pricings are set by the asset managers and the properties we bid on are also being bid on by other professional flippers and other groups that have alot of experience with the process. More often then not we did not bid on homes unless they were bid on by other players who we knew were experienced and good at the game.

An REO that is not purchased at trustee sale and is now listed on the market was BYPASSED by the regulars at trustee sale for a reason, it was either priced poorly or has other problems. So then it goes out to get assigned to a broker and put on the MLS.

My point is that if you only limit yourself to the criteria that you stated, it may not be the wisest strategy in the world.

However seeing as you have purchased lots of properties in San Diego I guess you are experienced at it and it has worked out well for you.

[temeculaguy]

There is another explanation, you said it sold for about 2% less than your offer. But if your realtor was set to make a 3% commission, then the net offer was actually 1% more than yours. You don’t know the listing agent’s comission if they also became the selling agent. Sometimes if they get both sides of the deal it is lowered, with reo’s, since there is very little work on the seller side, it is sometimes very low. If you asked for any consessions, or if you had fha financing that comes with costs to the seller, that knocks down your net offer. Having the listing agent represent you gives you the advantage of knowing what the other offers are. It isn’t supposed to work that way, but it does. More than likely, the other offer was probably a few hundred more “net” to the bank and the listing agent adjusted their commission to make it so.

Search old posts but I’ve written about this fairly extensively and in my reo buying saga, I failed to win until I went without a realtor. Realtors are great for standard sales, even short sales, but for reo’s that are being dumped quickly by a certain date, you need to go it alone (sorry realtors). There just isn’t anything they can do for you, you can’t be protected from much, it is an “as is” transaction. There are clauses that a realtor can include in a contract, there are things they can request, inspections that can be done, but in the reo “highest net offer by friday” scenarios, those clauses get your offer thrown in the trash, cause the other offer doesn’t have them.

My suggestion is to find your own properties and go straight to the listing agent as soon as possible. Don’t dally around, be able to look at a property and make an offer within 3 hours of it listing, that’s how you win. To do this you may need to stalk properties before they list, read the no trespassing signs, call the number that is listed for emergency contact on the sign and try to get them to hint as to who the listing agent will be (sometimes the emer contact is the future listing agent).

If it makes you feel better, you can pay a realtor or an attorney a fixed fee too look over the paperwork and do it on the side, away from your offer. But just know that any delay can sink you.

[temeculaguy]

There is another explanation, you said it sold for about 2% less than your offer. But if your realtor was set to make a 3% commission, then the net offer was actually 1% more than yours. You don’t know the listing agent’s comission if they also became the selling agent. Sometimes if they get both sides of the deal it is lowered, with reo’s, since there is very little work on the seller side, it is sometimes very low. If you asked for any consessions, or if you had fha financing that comes with costs to the seller, that knocks down your net offer. Having the listing agent represent you gives you the advantage of knowing what the other offers are. It isn’t supposed to work that way, but it does. More than likely, the other offer was probably a few hundred more “net” to the bank and the listing agent adjusted their commission to make it so.

Search old posts but I’ve written about this fairly extensively and in my reo buying saga, I failed to win until I went without a realtor. Realtors are great for standard sales, even short sales, but for reo’s that are being dumped quickly by a certain date, you need to go it alone (sorry realtors). There just isn’t anything they can do for you, you can’t be protected from much, it is an “as is” transaction. There are clauses that a realtor can include in a contract, there are things they can request, inspections that can be done, but in the reo “highest net offer by friday” scenarios, those clauses get your offer thrown in the trash, cause the other offer doesn’t have them.

My suggestion is to find your own properties and go straight to the listing agent as soon as possible. Don’t dally around, be able to look at a property and make an offer within 3 hours of it listing, that’s how you win. To do this you may need to stalk properties before they list, read the no trespassing signs, call the number that is listed for emergency contact on the sign and try to get them to hint as to who the listing agent will be (sometimes the emer contact is the future listing agent).

If it makes you feel better, you can pay a realtor or an attorney a fixed fee too look over the paperwork and do it on the side, away from your offer. But just know that any delay can sink you.

[temeculaguy]

There is another explanation, you said it sold for about 2% less than your offer. But if your realtor was set to make a 3% commission, then the net offer was actually 1% more than yours. You don’t know the listing agent’s comission if they also became the selling agent. Sometimes if they get both sides of the deal it is lowered, with reo’s, since there is very little work on the seller side, it is sometimes very low. If you asked for any consessions, or if you had fha financing that comes with costs to the seller, that knocks down your net offer. Having the listing agent represent you gives you the advantage of knowing what the other offers are. It isn’t supposed to work that way, but it does. More than likely, the other offer was probably a few hundred more “net” to the bank and the listing agent adjusted their commission to make it so.

Search old posts but I’ve written about this fairly extensively and in my reo buying saga, I failed to win until I went without a realtor. Realtors are great for standard sales, even short sales, but for reo’s that are being dumped quickly by a certain date, you need to go it alone (sorry realtors). There just isn’t anything they can do for you, you can’t be protected from much, it is an “as is” transaction. There are clauses that a realtor can include in a contract, there are things they can request, inspections that can be done, but in the reo “highest net offer by friday” scenarios, those clauses get your offer thrown in the trash, cause the other offer doesn’t have them.

My suggestion is to find your own properties and go straight to the listing agent as soon as possible. Don’t dally around, be able to look at a property and make an offer within 3 hours of it listing, that’s how you win. To do this you may need to stalk properties before they list, read the no trespassing signs, call the number that is listed for emergency contact on the sign and try to get them to hint as to who the listing agent will be (sometimes the emer contact is the future listing agent).

If it makes you feel better, you can pay a realtor or an attorney a fixed fee too look over the paperwork and do it on the side, away from your offer. But just know that any delay can sink you.

[temeculaguy]

There is another explanation, you said it sold for about 2% less than your offer. But if your realtor was set to make a 3% commission, then the net offer was actually 1% more than yours. You don’t know the listing agent’s comission if they also became the selling agent. Sometimes if they get both sides of the deal it is lowered, with reo’s, since there is very little work on the seller side, it is sometimes very low. If you asked for any consessions, or if you had fha financing that comes with costs to the seller, that knocks down your net offer. Having the listing agent represent you gives you the advantage of knowing what the other offers are. It isn’t supposed to work that way, but it does. More than likely, the other offer was probably a few hundred more “net” to the bank and the listing agent adjusted their commission to make it so.

Search old posts but I’ve written about this fairly extensively and in my reo buying saga, I failed to win until I went without a realtor. Realtors are great for standard sales, even short sales, but for reo’s that are being dumped quickly by a certain date, you need to go it alone (sorry realtors). There just isn’t anything they can do for you, you can’t be protected from much, it is an “as is” transaction. There are clauses that a realtor can include in a contract, there are things they can request, inspections that can be done, but in the reo “highest net offer by friday” scenarios, those clauses get your offer thrown in the trash, cause the other offer doesn’t have them.

My suggestion is to find your own properties and go straight to the listing agent as soon as possible. Don’t dally around, be able to look at a property and make an offer within 3 hours of it listing, that’s how you win. To do this you may need to stalk properties before they list, read the no trespassing signs, call the number that is listed for emergency contact on the sign and try to get them to hint as to who the listing agent will be (sometimes the emer contact is the future listing agent).

If it makes you feel better, you can pay a realtor or an attorney a fixed fee too look over the paperwork and do it on the side, away from your offer. But just know that any delay can sink you.

[temeculaguy]

There is another explanation, you said it sold for about 2% less than your offer. But if your realtor was set to make a 3% commission, then the net offer was actually 1% more than yours. You don’t know the listing agent’s comission if they also became the selling agent. Sometimes if they get both sides of the deal it is lowered, with reo’s, since there is very little work on the seller side, it is sometimes very low. If you asked for any consessions, or if you had fha financing that comes with costs to the seller, that knocks down your net offer. Having the listing agent represent you gives you the advantage of knowing what the other offers are. It isn’t supposed to work that way, but it does. More than likely, the other offer was probably a few hundred more “net” to the bank and the listing agent adjusted their commission to make it so.

Search old posts but I’ve written about this fairly extensively and in my reo buying saga, I failed to win until I went without a realtor. Realtors are great for standard sales, even short sales, but for reo’s that are being dumped quickly by a certain date, you need to go it alone (sorry realtors). There just isn’t anything they can do for you, you can’t be protected from much, it is an “as is” transaction. There are clauses that a realtor can include in a contract, there are things they can request, inspections that can be done, but in the reo “highest net offer by friday” scenarios, those clauses get your offer thrown in the trash, cause the other offer doesn’t have them.

My suggestion is to find your own properties and go straight to the listing agent as soon as possible. Don’t dally around, be able to look at a property and make an offer within 3 hours of it listing, that’s how you win. To do this you may need to stalk properties before they list, read the no trespassing signs, call the number that is listed for emergency contact on the sign and try to get them to hint as to who the listing agent will be (sometimes the emer contact is the future listing agent).

If it makes you feel better, you can pay a realtor or an attorney a fixed fee too look over the paperwork and do it on the side, away from your offer. But just know that any delay can sink you.

[EconProf]

Five weeks ago the exact same thing happened to me. A distressed bank-owned property was listed (in Yuma, AZ) by a local Realtor. I offered full price through my friend, a different agent, and was even required to show proof of funds for an all-cash offer, which I did. Waited a week with no answer. Then suddenly the property was under contract. Could not get my calls returned from the selling broker, and failed to get good follow-up answers from my own agent. I suspect my offer was not even submitted to B of A.
Conclusion: Go directly to the selling agent to give them the full commission. It ain’t right, but it is what it is.

[EconProf]

Five weeks ago the exact same thing happened to me. A distressed bank-owned property was listed (in Yuma, AZ) by a local Realtor. I offered full price through my friend, a different agent, and was even required to show proof of funds for an all-cash offer, which I did. Waited a week with no answer. Then suddenly the property was under contract. Could not get my calls returned from the selling broker, and failed to get good follow-up answers from my own agent. I suspect my offer was not even submitted to B of A.
Conclusion: Go directly to the selling agent to give them the full commission. It ain’t right, but it is what it is.

[EconProf]

Five weeks ago the exact same thing happened to me. A distressed bank-owned property was listed (in Yuma, AZ) by a local Realtor. I offered full price through my friend, a different agent, and was even required to show proof of funds for an all-cash offer, which I did. Waited a week with no answer. Then suddenly the property was under contract. Could not get my calls returned from the selling broker, and failed to get good follow-up answers from my own agent. I suspect my offer was not even submitted to B of A.
Conclusion: Go directly to the selling agent to give them the full commission. It ain’t right, but it is what it is.

[EconProf]

Five weeks ago the exact same thing happened to me. A distressed bank-owned property was listed (in Yuma, AZ) by a local Realtor. I offered full price through my friend, a different agent, and was even required to show proof of funds for an all-cash offer, which I did. Waited a week with no answer. Then suddenly the property was under contract. Could not get my calls returned from the selling broker, and failed to get good follow-up answers from my own agent. I suspect my offer was not even submitted to B of A.
Conclusion: Go directly to the selling agent to give them the full commission. It ain’t right, but it is what it is.

[EconProf]

Five weeks ago the exact same thing happened to me. A distressed bank-owned property was listed (in Yuma, AZ) by a local Realtor. I offered full price through my friend, a different agent, and was even required to show proof of funds for an all-cash offer, which I did. Waited a week with no answer. Then suddenly the property was under contract. Could not get my calls returned from the selling broker, and failed to get good follow-up answers from my own agent. I suspect my offer was not even submitted to B of A.
Conclusion: Go directly to the selling agent to give them the full commission. It ain’t right, but it is what it is.

[Racer5]

Thanks all, it really help to get more perspective.

SD, she said the bank wanted to see proof of funds, 30 day escrow (we/our agent stupidly put down 45, I even said to him, “Really?
For an REO?”), and our offer came in very late. These very well may be legitimate, although for example, she did not indicate proof of funds was required before hand. Anyways, done deal, we gotta be smarter next time.

Bearishgurl, we aren’t seeking out REOs in particular, for the reasons you mention. I just think there is a reasonable chance we’ll see another REO in the future that we like. Pickings are pretty slim in the areas (NC Coastal) and ranges we are looking at.

TG, Thanks for reminding me, I will definitely go read those again. I skimmed them at the time, thinking it would 3 years before I would be in your shoes.

Thanks,
Racer5

[Racer5]

Thanks all, it really help to get more perspective.

SD, she said the bank wanted to see proof of funds, 30 day escrow (we/our agent stupidly put down 45, I even said to him, “Really?
For an REO?”), and our offer came in very late. These very well may be legitimate, although for example, she did not indicate proof of funds was required before hand. Anyways, done deal, we gotta be smarter next time.

Bearishgurl, we aren’t seeking out REOs in particular, for the reasons you mention. I just think there is a reasonable chance we’ll see another REO in the future that we like. Pickings are pretty slim in the areas (NC Coastal) and ranges we are looking at.

TG, Thanks for reminding me, I will definitely go read those again. I skimmed them at the time, thinking it would 3 years before I would be in your shoes.

Thanks,
Racer5

[Racer5]

Thanks all, it really help to get more perspective.

SD, she said the bank wanted to see proof of funds, 30 day escrow (we/our agent stupidly put down 45, I even said to him, “Really?
For an REO?”), and our offer came in very late. These very well may be legitimate, although for example, she did not indicate proof of funds was required before hand. Anyways, done deal, we gotta be smarter next time.

Bearishgurl, we aren’t seeking out REOs in particular, for the reasons you mention. I just think there is a reasonable chance we’ll see another REO in the future that we like. Pickings are pretty slim in the areas (NC Coastal) and ranges we are looking at.

TG, Thanks for reminding me, I will definitely go read those again. I skimmed them at the time, thinking it would 3 years before I would be in your shoes.

Thanks,
Racer5

[Racer5]

Thanks all, it really help to get more perspective.

SD, she said the bank wanted to see proof of funds, 30 day escrow (we/our agent stupidly put down 45, I even said to him, “Really?
For an REO?”), and our offer came in very late. These very well may be legitimate, although for example, she did not indicate proof of funds was required before hand. Anyways, done deal, we gotta be smarter next time.

Bearishgurl, we aren’t seeking out REOs in particular, for the reasons you mention. I just think there is a reasonable chance we’ll see another REO in the future that we like. Pickings are pretty slim in the areas (NC Coastal) and ranges we are looking at.

TG, Thanks for reminding me, I will definitely go read those again. I skimmed them at the time, thinking it would 3 years before I would be in your shoes.

Thanks,
Racer5

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