Okay, I’ve been searching around online and have found out that a good number of properties in my area are Bank Owned resales. A few questions…
Are these properties that went through foreclosure that did not get a bid that was acceptable to a the banker?
These are all listed on the MLS. Are these the same properties that you can get for 30-50 cents on the dollar when purchasing through a realtor?
Thanks!
Dan
they did go though forclosure and did not get a bid that was greater than what the bank was willing to buy back the property for.
you will probably not be able to buy them for 30-50 cents on the dollar, not because they are through a realtor, but because while the bank is not in the home owning business, they are not stupid, and know what the property is worth.
So is it just as unlikely to get a deal on these houses as with any other property on the mls?
Are the banks fine with carrying a large inventory or are they looking to dump at some point and move on?
Robb (aka, reoconsultants) said he made a lot of money with REO’s. One thing he said he did was buy in bulk. Of course, not too many of us are ina position to do that.
the banks will continue to lower their prices if the listing does not sell. The longer the market time, the lower the price. I was able to purchase an MLS property that started at $270k for $212, but it was on the market for almost 200 days in a area that had a normal market time of 15-45 days.
Network with the top REO realtors in your area and have them call you when the banks are ready for a serious price drop. I have been picking up homes for 40 to 60 cents on the dollar using this. Just be sure that if you do get the call, and you do write up a contract that you follow through, otherwise you wont get those calls anymore.
If you cant close thes homes yourself find your buyers and when you get the calls put your buyers on the home for a bird dog fee. If you have buyers you can still remain the go to person for great deals.
Eric Medemar
p.s watch the price change timeline and many times you can determine when the prices are going to change and be one step ahead of your competition.
Thanks. I can use many websites for searching for properties, but other than writing down the prices myself and tracking them, how can I tell how long they’ve been on the market. (Realtor? has this info?)
Bank’s aren’t in the business of owning real estate (usually), every dollar they have tied-up in a property is a dollar that isn’t earning them anything. Bank REO is also known as a non-performing asset and when this number gets too high bank management must answer to their boards of directors and the government regulatory agencies. Therefore they try to optimize the disposal of these parcels balancing any loss with how long the property is on their books earning nothing.
You can actually pull the financial statements of every bank in the US from the FDIC website. If you look for the ratio of non performing assets it may give you insight into the bank’s attitude on disposing of properties. A bank with lots of NPA’s may be willing to deal, then again a bank with few NPA’s may be more quick at disposing of their REO.