You must have read a lot of posts on forums of investors describing the purchase of REO properties as one of the most stressful experience of their lives.
Many investors get frustrated that despite too much time invested in working with their agents, their bids are not getting accepted.
In some of these cases these buyers are not getting the right guidance from their agents. But there are also quite a number of instances when clients just have unrealistic expectations.
Below are some clarification on what you can expect from your REO agent and the bank.
1) Banks are informed sellers.
Banks work with local realors who give them ‘broker price opinions’ on how much the property can sell in the market. Unreasonably low offers will not be considered. Here, your REO agent should be able to provide you with critical information to ‘make your most competitive offer properly.
a) Property inspection reports from the listing agent if there are any;
b) Selling price of comparative homes in the neighborhood,
c) Proposed supply of foreclosed homes in the market
2) Your REO agent’s ‘experience and industry network’ matters a lot (as it is true with managing all complicated transactions).
REO properties involve a lot of hard work on everyones part (buyer’s agent, bank’s listing agent, bank’s REO department, and YOU). A lot of paperwork and approvals from different individuals, companies, and even investors are needed to sell an REO property.
Here’s your REO agent should be able to help you quickly provide the bank with a complete and competitive offer / counter-offer according to their specified format, requirements, and preferred method of receiving offers (e-mail, fax, and etc.).
And most importantly, your chances of buying a good REO property is increased if you hire an REO agent with a good relationship with bank asset managers and their listing agents, and have years of experience in helping buyers purchase REO properties.
So get ahead of the REO game by working with an experienced REO agent who can help you win a bid for a great REO property.