REO, who has been a wonderful source of information and all around “VERY” helpful, said that it’s List Price minus 6% Commission minus Closing Costs equal NET.
So: List Price
- 6% Commission
TOTAL
- Closing costs
= NET
Does anyone else see this a different way? Am I suppose to “ADD” those extra costs, not subtract?
Thank You and God Bless,
Brandon
This formula is only for VA properties. On the VA contract, you and the agent will fill in the blanks. The VA contract is basically a net sheet. The only thing they really look at is Line 7 A - NET TO VA = $xxxxxx. Highest NET offer wins the bid. HUDs are also similar, except 5% commision.
This doesn’t apply to bank REO properties. Generally, the listing agent will prepare a net sheet for their seller after they receive the offer.
I was trying to show you to not only think about your offering price, but think about what the net will actually be to the seller. Also, VA doesn’t care if the buyer is paying cash or financing. They still only care about the highest net.
The closing cost is what you want to the seller to pay. So it comes off their net. You can put 0, but you will pay for everthing. Here’s the beauty. VA will pay closing cost if you ask for it in the contract. They are very flexible with this. Banks will only pay limited/very little closing cost.
You’re a life saver…Will they make a counter offer or acceptance after I make my offer or do they have a time limit bidding process?