REO sale at less than our offer

[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

[bearishgurl]

Racer5, I haven’t read TG’s old posts but have no doubt that he was “represented” by the selling agent (as EconProf suggested to do) if he “went without a realtor.” In a resale property marketed on the MLS which has an accepted offer, ALL parties are “represented” by agent(s) or broker(s). As a buyer, if you choose to enter into a “dual agency” with a listing agent/broker, their primary fiduciary duty will lie with the seller’s best interests, NOT yours.

[bearishgurl]

Racer5, I haven’t read TG’s old posts but have no doubt that he was “represented” by the selling agent (as EconProf suggested to do) if he “went without a realtor.” In a resale property marketed on the MLS which has an accepted offer, ALL parties are “represented” by agent(s) or broker(s). As a buyer, if you choose to enter into a “dual agency” with a listing agent/broker, their primary fiduciary duty will lie with the seller’s best interests, NOT yours.

[bearishgurl]

Racer5, I haven’t read TG’s old posts but have no doubt that he was “represented” by the selling agent (as EconProf suggested to do) if he “went without a realtor.” In a resale property marketed on the MLS which has an accepted offer, ALL parties are “represented” by agent(s) or broker(s). As a buyer, if you choose to enter into a “dual agency” with a listing agent/broker, their primary fiduciary duty will lie with the seller’s best interests, NOT yours.

[bearishgurl]

Racer5, I haven’t read TG’s old posts but have no doubt that he was “represented” by the selling agent (as EconProf suggested to do) if he “went without a realtor.” In a resale property marketed on the MLS which has an accepted offer, ALL parties are “represented” by agent(s) or broker(s). As a buyer, if you choose to enter into a “dual agency” with a listing agent/broker, their primary fiduciary duty will lie with the seller’s best interests, NOT yours.

[bearishgurl]

Racer5, I haven’t read TG’s old posts but have no doubt that he was “represented” by the selling agent (as EconProf suggested to do) if he “went without a realtor.” In a resale property marketed on the MLS which has an accepted offer, ALL parties are “represented” by agent(s) or broker(s). As a buyer, if you choose to enter into a “dual agency” with a listing agent/broker, their primary fiduciary duty will lie with the seller’s best interests, NOT yours.

[SD Realtor]

Racer sounds like it was a combo of a tough break and yes, it seems the offer could have been presented in an alternate manner. It is what it is. Chalk it up to a learning experience. Here are a few ways to make your offer more competitive:

– Do not ask for a termite clearance.
– Do not ask for a home warranty or let the seller know you will pay for it.
– Accelerate your inspection contingency to 10 or 12 days.
– Provide proof of funds. Make sure they are current.
– Come with your strongest offer. Dont assume there will be a counter offer. Dont mess around.
– Keep the escrow as short as possible.

Please note these measures should be taken iff you REALLY want the home. If you are trying to get a good deal then that is fine but you risk losing out. If it is a home you love then only you can put the price tag on overpaying.

Finally be prompt and move quick. As a listing agent I am wary of an offer that comes in at the last minute after I have a few offers on a place. Those last minute ones are people who know they have to act hard and act fast and there is a propensity for those buyers to back out if accepted because they were pressured to make the offer by time rather then by desiring the home. That is not to say that I wouldn’t take the offer and you do hear stories about a last minute offer coming in and blowing people away. Still my advice would be to err on the side of caution and move early. There are cons to this as your offer may be used as leverage to get other offers but you do what you gotta do.

I cannot argue about the validity of working with the listing agent. I am not saying you would get a break on price but you might and the listing agent will be happy double ending. However I know plenty of agents who have represented buyers and had the offers accepted. I know I have and I am sure sdr has as well. Still TG gave good advice and I could never argue against it except to repeat your representation will not be what I would call stellar.

One other thing was that you did not mention how much cash the other buyer came in with. I will agree though that ANY REO lender wants a fast escrow rather then 45 days. That was a VERY bad move.

[SD Realtor]

Racer sounds like it was a combo of a tough break and yes, it seems the offer could have been presented in an alternate manner. It is what it is. Chalk it up to a learning experience. Here are a few ways to make your offer more competitive:

– Do not ask for a termite clearance.
– Do not ask for a home warranty or let the seller know you will pay for it.
– Accelerate your inspection contingency to 10 or 12 days.
– Provide proof of funds. Make sure they are current.
– Come with your strongest offer. Dont assume there will be a counter offer. Dont mess around.
– Keep the escrow as short as possible.

Please note these measures should be taken iff you REALLY want the home. If you are trying to get a good deal then that is fine but you risk losing out. If it is a home you love then only you can put the price tag on overpaying.

Finally be prompt and move quick. As a listing agent I am wary of an offer that comes in at the last minute after I have a few offers on a place. Those last minute ones are people who know they have to act hard and act fast and there is a propensity for those buyers to back out if accepted because they were pressured to make the offer by time rather then by desiring the home. That is not to say that I wouldn’t take the offer and you do hear stories about a last minute offer coming in and blowing people away. Still my advice would be to err on the side of caution and move early. There are cons to this as your offer may be used as leverage to get other offers but you do what you gotta do.

I cannot argue about the validity of working with the listing agent. I am not saying you would get a break on price but you might and the listing agent will be happy double ending. However I know plenty of agents who have represented buyers and had the offers accepted. I know I have and I am sure sdr has as well. Still TG gave good advice and I could never argue against it except to repeat your representation will not be what I would call stellar.

One other thing was that you did not mention how much cash the other buyer came in with. I will agree though that ANY REO lender wants a fast escrow rather then 45 days. That was a VERY bad move.

[SD Realtor]

Racer sounds like it was a combo of a tough break and yes, it seems the offer could have been presented in an alternate manner. It is what it is. Chalk it up to a learning experience. Here are a few ways to make your offer more competitive:

– Do not ask for a termite clearance.
– Do not ask for a home warranty or let the seller know you will pay for it.
– Accelerate your inspection contingency to 10 or 12 days.
– Provide proof of funds. Make sure they are current.
– Come with your strongest offer. Dont assume there will be a counter offer. Dont mess around.
– Keep the escrow as short as possible.

Please note these measures should be taken iff you REALLY want the home. If you are trying to get a good deal then that is fine but you risk losing out. If it is a home you love then only you can put the price tag on overpaying.

Finally be prompt and move quick. As a listing agent I am wary of an offer that comes in at the last minute after I have a few offers on a place. Those last minute ones are people who know they have to act hard and act fast and there is a propensity for those buyers to back out if accepted because they were pressured to make the offer by time rather then by desiring the home. That is not to say that I wouldn’t take the offer and you do hear stories about a last minute offer coming in and blowing people away. Still my advice would be to err on the side of caution and move early. There are cons to this as your offer may be used as leverage to get other offers but you do what you gotta do.

I cannot argue about the validity of working with the listing agent. I am not saying you would get a break on price but you might and the listing agent will be happy double ending. However I know plenty of agents who have represented buyers and had the offers accepted. I know I have and I am sure sdr has as well. Still TG gave good advice and I could never argue against it except to repeat your representation will not be what I would call stellar.

One other thing was that you did not mention how much cash the other buyer came in with. I will agree though that ANY REO lender wants a fast escrow rather then 45 days. That was a VERY bad move.

[SD Realtor]

Racer sounds like it was a combo of a tough break and yes, it seems the offer could have been presented in an alternate manner. It is what it is. Chalk it up to a learning experience. Here are a few ways to make your offer more competitive:

– Do not ask for a termite clearance.
– Do not ask for a home warranty or let the seller know you will pay for it.
– Accelerate your inspection contingency to 10 or 12 days.
– Provide proof of funds. Make sure they are current.
– Come with your strongest offer. Dont assume there will be a counter offer. Dont mess around.
– Keep the escrow as short as possible.

Please note these measures should be taken iff you REALLY want the home. If you are trying to get a good deal then that is fine but you risk losing out. If it is a home you love then only you can put the price tag on overpaying.

Finally be prompt and move quick. As a listing agent I am wary of an offer that comes in at the last minute after I have a few offers on a place. Those last minute ones are people who know they have to act hard and act fast and there is a propensity for those buyers to back out if accepted because they were pressured to make the offer by time rather then by desiring the home. That is not to say that I wouldn’t take the offer and you do hear stories about a last minute offer coming in and blowing people away. Still my advice would be to err on the side of caution and move early. There are cons to this as your offer may be used as leverage to get other offers but you do what you gotta do.

I cannot argue about the validity of working with the listing agent. I am not saying you would get a break on price but you might and the listing agent will be happy double ending. However I know plenty of agents who have represented buyers and had the offers accepted. I know I have and I am sure sdr has as well. Still TG gave good advice and I could never argue against it except to repeat your representation will not be what I would call stellar.

One other thing was that you did not mention how much cash the other buyer came in with. I will agree though that ANY REO lender wants a fast escrow rather then 45 days. That was a VERY bad move.

[SD Realtor]

Racer sounds like it was a combo of a tough break and yes, it seems the offer could have been presented in an alternate manner. It is what it is. Chalk it up to a learning experience. Here are a few ways to make your offer more competitive:

– Do not ask for a termite clearance.
– Do not ask for a home warranty or let the seller know you will pay for it.
– Accelerate your inspection contingency to 10 or 12 days.
– Provide proof of funds. Make sure they are current.
– Come with your strongest offer. Dont assume there will be a counter offer. Dont mess around.
– Keep the escrow as short as possible.

Please note these measures should be taken iff you REALLY want the home. If you are trying to get a good deal then that is fine but you risk losing out. If it is a home you love then only you can put the price tag on overpaying.

Finally be prompt and move quick. As a listing agent I am wary of an offer that comes in at the last minute after I have a few offers on a place. Those last minute ones are people who know they have to act hard and act fast and there is a propensity for those buyers to back out if accepted because they were pressured to make the offer by time rather then by desiring the home. That is not to say that I wouldn’t take the offer and you do hear stories about a last minute offer coming in and blowing people away. Still my advice would be to err on the side of caution and move early. There are cons to this as your offer may be used as leverage to get other offers but you do what you gotta do.

I cannot argue about the validity of working with the listing agent. I am not saying you would get a break on price but you might and the listing agent will be happy double ending. However I know plenty of agents who have represented buyers and had the offers accepted. I know I have and I am sure sdr has as well. Still TG gave good advice and I could never argue against it except to repeat your representation will not be what I would call stellar.

One other thing was that you did not mention how much cash the other buyer came in with. I will agree though that ANY REO lender wants a fast escrow rather then 45 days. That was a VERY bad move.

[briansd1]

[quote=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.[/quote]

I don’t remember reading your old posts on REOs. But I’ll look for them.

Good advice. I have my eyes on a duplex REO (not in San Diego) that went into hibernation for the winter. I’ll try your strategy when it relists again.

[briansd1]

[quote=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.[/quote]

I don’t remember reading your old posts on REOs. But I’ll look for them.

Good advice. I have my eyes on a duplex REO (not in San Diego) that went into hibernation for the winter. I’ll try your strategy when it relists again.

[briansd1]

[quote=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.[/quote]

I don’t remember reading your old posts on REOs. But I’ll look for them.

Good advice. I have my eyes on a duplex REO (not in San Diego) that went into hibernation for the winter. I’ll try your strategy when it relists again.

[briansd1]

[quote=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.[/quote]

I don’t remember reading your old posts on REOs. But I’ll look for them.

Good advice. I have my eyes on a duplex REO (not in San Diego) that went into hibernation for the winter. I’ll try your strategy when it relists again.

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