Hi,
Can someone provide a quick overview on buying an REO property? How much room, if any, is there to negotiate on the price? Do standard realtor fees apply (ie 6%)?
Thanks,
Jean
Most times with REOs, you will be dealing with a property already listed on the MLS. The commission will depend on the owning lender. I think HUD has a maximum % they allow a realtor to have.
Some banks have their own REO department where you can make an offer directly with them.
The % off the price is dependent upon so many things:
- how long the bank has owned the property
- how many properties the bank has in their inventory
- the time of year
There is always room to negotiate, but don’t be surprised to hear a bunch of ‘nos’. Offer what you need, and if the bank won’t work with you, move on to the next one. Banks can be very hard headed about working with investors, and some will continue to hold the property in the hopes that the retail market will buy it.