Hi, I am a very new investor, I thought short sale is the best way to get started, but that was a big mistake. I am working with a house which was built in 1982, no improvements , needs about $ 10,000 or more, to be fixed, I have checked zillow , it is $144,000 , and I have check the comps , all the houses in that area are about $140,000 to $170,000, I mad an offer for $95000, and the loss mitigation said no that’s too low , the house was refinanced and appraised on October for $170,000 . If I make an offer for $120,000 is that too high, or too low? :smile
Did loss mitigation make counter? 120K too much if low comp is 140K and still requires 10+K for repairs. Not much room for profit.
First rule is don’t chase a deal. You are correct that short sales and foreclosures can be a tough place for a newbie to start. I usually advise that starting with wholesaling makes more sense.
Remember that no deal is better than a bad deal and only buy under your terms and conditions. You make your money on the purchase not on the sale, especially in the current market.
Challenge the banks appraisal with your own interior BPO or from a non interested party. Make sure to include as many pictures necessary to show the high amount of repair items needed, along with an assosiated repair value. It sounds like the 10/2007 appraisal is too high based on your CMA and you’re expert on this property, right? Keep the prssure on with the lowest BPO possible. Don’t use Zillow either. Mmaster is right, no deal is better than a bad deal. Always keep that in mind and remember that the bank has more to loose than you do. Good luck!