Bank Owned Question

14 years ago

I'm new here...but I have a quick question and you all seem pretty knowledgable! :o) My husband and I put in an offer on a bank owned property. Two days later, our agent called and said the bank wants our "best and final" offer. The house has been listed for about 130 days at this point. It has had 4-5 price drops in that time frame, nearly 30% total. I really want this house. My husband does not want to offer the full listing price and I just don't know what to do. He wants to offer about $4000 less. I am so nervous and worried we won't get it. What should we do??

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Comments (14)

larke
14 years ago
4-5 price drops is not full listing price, so if he loves you, he'll offer if not full asking, at least pretty darn close to it! Hoping it'll keep dropping is a game, but a dangerous one. There's such a thing as being too greedy (how everyone got in the mess to begin with) after all, so if you think the asking is a fair price for the house, then go for it.
alabamanicole
14 years ago
I agree with larke. If you want THIS house and are willing to pay list price for the home, then offer list price. $4k isn't much. (Provided, of course, the home is actually worth the sales price.)

If you are willing to gamble and possibly lose the home, but all means offer less. There are other houses out there.
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3 showings in 3 months is pretty telling as is the "buts" that the viewers mentioned. Anytime a viewer says that they love it but... what they really mean is that the price would have to be lower to cancel out that but. Your new agent will need to work to give you an accurate assessment of the market and you will have to be open to what you may be told. Anyone who tells you that your home is "worth" 925K and then you have to drop it 225K to get even 3 showings is either clueless or doesn't have enough gumption to tell you the truth about the pricing that you don't want to hear. Any home priced 500K above those of it's neighbors, even if they are smaller and with less acreage, is an anomaly for the area. As such, there may be no true accurate comps. That always bodes poorly for the most expensive home surrounded by less expensive ones. In real estate, location is everything. It counts more than amenities. It counts more than acreage. A million dollar custom home in the middle of a nowhere cornfield in agricultural Iowa surrounded by modest homes that price out at less than 100K will have a very hard time even selling for 300K. Put that same house in a tony Detroit suburb where homes go for twice that price, and you might get well above the 1M because of the location and the value of it being the cheapest house in the neighborhood. You can't escape your location. All you can do is price it low enough that the location is enticing.
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qdwag
14 years ago
$4K is not much on a $400k home, but IS a lot on a 40K home, so unless you post the current price,opinions are really useless
Carol_from_ny
14 years ago
It also makes a difference with a bank if you are making your offer based on a loan or a cash sale. Someone offering less money but a cash deal will win out over someone who has to wait for a loan even at a higher selling price.
purpleslippers
Original Author
14 years ago
OK, my fault for not giving a good background story...house was a foreclosure in Oct. 09. Was listed for just under $100,000 at that point. As I said, 4-5 price drops later, it is at $69,900. So I think that 4000 makes a difference...
hendricus
14 years ago
A house that was 100k and has been reduced to 70k looks like a lot of work to me. Offer half, 35k, and figure on the other 35k to renovate it.

All they can say is no if they don't take it and then you can dicker with them.
purpleslippers
Original Author
14 years ago
We are still waiting to hear anything from the bank. This is so frustrating. We put in an offer on 2/2. The paperwork said it could take 7-10 business days to get an answer, but I am impatient. There are very few properties available in our area. Also we are limited to our area because of my husband's job...we could make this house great, I know it...I am just so nervous we won't get it!
brickeyee
14 years ago
"The paperwork said it could take 7-10 business days to get an answer..."

For REO that would be like lightening.

IF you want the place be prepared to wait MONTHS while the bank screws around.

Banks do not like to lose money, and if they are going to on a sale they will use numerous committees to make sure no single person at the bank will be held responsible.
terezosa / terriks
14 years ago
In my area most of the banks are dealing with REO properties rather quickly. It is the short sales that take months.
Billl
14 years ago
My sister recently bought a REO property. They accepted the offer within a couple days. Then, they took MONTHS to close. I'm sure it depends on the bank, but to me, it seems as though some aren't only "to big to fail" but also "to big to get anything done quickly."
beachlily z9a
14 years ago
I've worked for a "too big to fail bank that did fail" and I've worked for the government. There is no difference in the speed or in the number of levels of management. Makes retirement wonderful!
brickeyee
14 years ago
"My sister recently bought a REO property. They accepted the offer within a couple days. Then, they took MONTHS to close."

The banks also like to put clauses in the contacts allowing them to back out if they decide at almost any point up to the closing table.

I have seen them shop accepted contracts for months hoping for something better to come along while stringing along the buyer they 'accepted.'

Do not sign a bank contract without an attorney going over it.
purpleslippers
Original Author
14 years ago
Well. We were informed today that our offer was rejected and they were accepting another offer. I am very upset. Does anyone have any experience with this? I am wondering if we should submit another offer because I have read that bank owned deals are never over until closing.
chrisk327
14 years ago
If you think the house is worth more, then you could. At least based upon Brickeye's comments, they are accepting offers until contract at least

Bank Owned Question

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