if a property is an reo and listed with a realtor, is it possible to do a ss and will I get a bad reputation with realtor/bank if I submit an offer much less than bpo. house is listed for $540k would like to offer $375k… never done ss before, so any help would be appreciated
I may misunderstand what you’re asking, but to me a “ss” (short sale) is done before the property goes to foreclosure and becomes an REO. If the property is an REO, than you’re simply making an offer. Agents are required to present any written offers they receive. You can’t worry about getting a bad reputation, you’ll have many more offers rejected than accepted.
tom,
thanks for the advice, i thought a “ss” was simply a low ball bid to the bank whether it was owned by them not. any ideas on how to approach realtors about short sales on their preforeclosure listings? Seems like most realtors are unaware of this process or worried they will lose their commissions. I’ve also heard it was illegal to offer homeowner any compensation to get them to sign a release. Is this true?
If a realtor has a listing that’s going into foreclosure, it’s going to be tough to try and work a short sale. You would need to convince the realtor and owner to release their listing (realtor would expect a fee) and let you try and do a ‘ss’. Unless you have a very good track record and have worked with the lenders involved, it would be hard to convince them. And, yes, it’s illegal and unethical (IMO) to go around a realtor and try and get the homeowner to sign a release.
You’re best approach is to go after pre-foreclosures before they are listed with a realtor.
A “short sale” is when a property owner is facing foreclosure and the lender agrees to take a lesser amount than is owed to the lender. It is still cheaper for them to do this than to do a full-blown foreclosure.
A home owner cannot receive ANY profits from a short sale. In fact, the forgiven amount may cause a tax consequence that they will need to rectify.
Keith