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5 Complaints of Short Sale and REO Buyers: Part Two

04 Aug

2.  Bank won’t take lowball offer.  If I had a
dollar for every time I’ve received a question from an outraged reader to the
effect that a buyer has had their short sale or REO offer rejected on grounds
that it was too low,  even though the bank has no other
offers, I could buy a foreclosure myself (admittedly, it’d be one of those
$150 foreclosures in some blighted town with tax liens and no plumbing, but
still).

Banks owe their shareholders and investors a duty to get as much
as they can for these properties. Just because you see it’s on the market and
listed as a short sale or a foreclosure doesn’t mean they’re going to give it
to you for a fraction of its worth. The bank’s goal is to get a purchase price
as close as possible to the home’s fair market value, as determined by the
recent sales prices of similar, nearby homes, with some adjustments made for
the property’s condition.  Fact is, many banks would rather see the
listing agent reduce the price by a moderate amount, and wait to see what offers
come in, than to accept an offer 30 percent below the asking price just because
there are no other offers on the table.

Avoid the drama by:
working with your agent to make a realistic offer, based on recent
comparable sales in the neighborhood, not just on what you think you can get
away with.  You can waste a lot of time, spin a lot of wheels and lose out
on a lot of properties making lowball offer after lowball offer on distressed
homes. Sit down with your broker or agent, review the ‘comps’ and make a smart
offer that reflects a good value for you, is within your budget and is not
bizarrely out of the realm of the fair market value of the property.

Author: Tara Nicholle Nelson from Trulia.com

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Posted by on August 4, 2011 in Buying, The Market

 

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