I did a walk through yesterday on a house I found on the MLS. As we got through,the Realtor said ,oh! by the way this is a foreclosure.I came home and did a little searching and found the property on the county Tax Assessors website and it shows the
Mortgage company as the owner. The report also states that the deed was dated 10/4/05. I know the house has been listed for a few months,and the asking price has been lowered four grand. So my actual question is,Is this a Foreclosure or REO? The agent said the owner would probably take less than asking price. Would .70 on the dollar work here as an initial offer? One other thing. The “Owner”( mortgage Co.) has a sign in the front yard that reads 100% financing available.Any help appreciated.
denbeck : :help

Note that the realtor said this is a forclosure not that this home is in foreclosure. Just another way of saying bank owned REO. Your the buyer, make any offer you want and take them up on the 100% financing, worst they can say is no.

You really shouldn’t look at price too closely. On any deal you want to calculate your maximum offer by looking at ARV and repair costs. Then, submit your offer based on that.

I like to make very low ball offers in the beginning, since you never know what the response will be. This gives you a chance to see somewhat where the bank is standing on a sellling price.

Say the house is worth in current condition 200K and needs an est 30K in repairs bring the value to 280K. Say the bank foreclosed on the home for 180K, this does not mean the bank want 180K, they may still be willing to take a loss. I would offer on a home worth 280K at completion about 125-140K to start and then go from there on counter offers. No matter how low you offer ,the realtor is obligated by law to present all offers on the property. If you feel they are not, then you need to contact the legal department in the bank and let them know and present the offer yourself. Ask the realtor for a letter showing your offer was rejected and that you want to counter offer.

Also keep in mind, if for some chance the home owner had only one mortgage with PMI on it, then the bank collected 20% from the insurance company after it foreclosed which means they can accept a smaller offer…

Remember you can never go down on your offer, only up so do not offer to much…

After doing my due diligence and figuring the repair costs, do I still get an appraisal to determine ARV,or would a desk review appraisal work? To make an offer,I know I will have to have a pre-approval letter,so is it best to get the pre-approval from the lender offering the property or a different one. If I get it from the one offering the property,how would it work to come back with a lower offer?
Thanks anyone & everyone,