Need some immediate input here, so please help. Looking at an reo due to go to sheriff sale soon. Typical 3/2 with detached garage on several acres.
Currently listed with a realtor for 340k. Balance on loan is 240K. Property is in good shape and does not seem to be in need of repair. What would a good offer be on this property. (No other offers are pending)
Come on guys and gals…I’m dying here!!! LOL!!!
If it’s scheduled for auction, it’s not an REO yet…
Anyway, my best answer for your question about how much to offer is this: What is it worth to you. I use a spreadsheet to calculate my max offer for any house. It starts with the FMV from comps and subtracts financing costs, holding costs, rehab costs, selling costs, a little “oops” money, and (of course) my profit. If the offer isn’t accepted, then it isn’t worth it to go higher anyway. If it is accepted, then I know I’m going to make $$ on the deal.
Thanks for the the reply. I know what it is worth to me, but I was trying to get an idea as to what would be considered a “reasonable” offer. I think the 70% rule of thumb may work on this one. Just wanted to know how low is too low. Didn’t want to come in so low that the mortgage company would refuse to deal with me and let it go to auction.
I KNOW it is an REO as the realtor who listed stated that any offer made would be presented to the MORTGAGE COMPANY who now has possession of the home.
keep in mind …the purpose of the froeclosure auction is for the lender to regain legal possession of the property from the defaulted borrower, after they get possession it then becomes an REO Property. Unless the borrower submitted a deed in lieu, if this is the case they will usually forego the sale.
but, in any case I would submit an offer at 70% LTV. assuming you know who to submit it to.
Good Luck.
Tony
real newbee what is an REO? we are talking about foreclosures here aren’t we?? I am just trying to sift through every question and answer topic in the chat room to get an understanding of the terms i will need to know. And if anyone can tell me are there actual meetings for REI members or is this strictly an online communuty?? and is there a good investment group in norcal to meet with?
Howste,
Would you mind sharing your calculation sheet.
Thanks in advance.
Regards
-Praveen
Hi Johnnydreamer
Real Estate Owned (REO) - property acquired through a lender through foreclosure and held in inventory.
thanks any info on clubs to join in novato cal. area?? i do have a seminar next weekend an intensive 8 hr /day 3 day workshop. but then i would like to develop some contacts and friends in the area. I need to learn exactly how to value the market of particular homes in this area and how to calculated repair costs
thanks again
Sure. Send me a PM with your email.
Thanks Howste for quick response and sharing info.
-Praveen
Howste,
Your email address is hidden in profile therefore could not sent mail.
You can get my address from my profile.
Regards
-Praveen