Need help - just got a bank's offer, what should I do?

After months, the bank finally sent their appraiser to the home and gave me a final price of what they want.

The amount owed on the home was about $460k.
The bank is now asking $400k.

The representative at first said $410k, and I asked her what her bottom, bottom-line is and she said $400k.

Should I believe that? She wouldn’t go any lower, but does anyone have experience with this? I’m thinking that if I present them with an offer for $390k, they may take it. What do you all think?

Also, an important side note, this is with GMAC. The representative told me that GMAC can afford to hold onto property better than other banks because they have a department specifically for foreclosures, etc. So they don’t have to take incredibly big hits.

She’s towing the company line “GMAC can afford to hold property”. Doesn’t matter which bank owns the house it still costs them money every day the property sits. You need to determine what the property is worth to you and make your offer, don’t worry about what was owed, or what their appraiser or rep says. Go for it.

All that you need to know is if the numbers work for you. Unless, you are in a time crunch, an offer of 390 would not hurt.

What is is worth? Realistically, backed by good recent comps. You know and I know holding this property is not what they want to do, it limits their lending ability. Figure out what you think its worth, figure out your max offer and make it. Your max offer should have NOTHING to do with what the rep says. If you make your offer and they reject it you have won because you didn’t buy a loser deal just to buy something. Besides, they may reject it now and come back in 6-8 months wanting to deal. REOs can take a while to materialize.

Exactly. What is owed isn’t relevant to the conversation. You offer the price that will make you a suitable profit for yourself. The bank can take it or leave it. You are in business to make money for yourself. You aren’t in business to fix the bank’s foreclosure problems.