We are looking at some REO properties and I would like to put some offers in. My partner is wanting to get bids from contractors before putting in offers to be totally sure one the numbers. With the speed that these properties are being bought up, I do not see having all the time to get a bunch of contractors to come in and give bids. Is there a way after the offer is accepted have the contractors come in, give bids and if they are higher than estimated back out.
Yes that is a contingency for an inspection. Often banks don’t want contingencies, they want to make sure the deal goes through. Especially if the REOs are selling quickly they don’t need to let you have one, as there are plenty of other buyers. When properties are selling slowly then they will be more flexible.
If suggest you make you bank offers as strong as possible. Make the contingency short, like 5 days so they know the property won’t be tied up long. Also large deposits can help as well as proof of funds.
I know you can put an inspection in there, but if you back out do you lose your earnest money? I have been hearing different things on this. I was told by one person that there is already a 7 day period in PA’s with REOs and that is when they get their contractors in to get bids and see if the numbers work. Ha anyone heard of this?
If you have an inspection period in your contract and and cancel the contract within that time period then you will get your deposit back.
Some of the banks include a 7 or 10 day inspection period in their addenda, so sometimes even if you do not include an inspection in your initial offer, you will end up getting one anyway.
Banks like to see clean offers with no contingencies, so an inspection period will weaken your offer a bit, but it’s not a deal killer by any means, esp if it’s only a couple of days.