Question on wholesaling REO's

I have read a few topics here that people are using bank REO's from Realtor's to wholesale the properties.
My question is: How do you deal with the customer doing a comp search that shows the property is listed with a Realtor? Anyone can go onto that Cyber... and it will show what a property is currently listed at..$$.. How do you handle that situation with the potential new owner?

Edited: 06/26/2010 at 06:05AM

Stephani Davis

Real Estate Investor · Tampa, Florida

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Oct 07 '08, 08:43 AM

Best to just be honest with them. I tell people first thing that I am a wholesaler and I specialize in bank owned properties. I make it very clear to them upfront that I am buying from the bank, and then selling to them. It also states in my contract (to sell), that the sale is contingent upon me buying the property from the bank.

I have never had any resistance from any buyer once they found out that the property was listed. If they are getting a good deal, they shouldn't care. If they do- find another buyer.

Good luck,
Steph

Edited: 06/26/2010 at 06:05AM

Ingrid Nagy

Property Manager · Passaic, New Jersey

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Oct 07 '08, 03:39 PM

Not sure if this is what you are talking about? I found a mobile home on MLS listed at $52.5K. I found the same home listed on a HUD website for $36K with the highest bid at $20K.

Edited: 06/26/2010 at 06:05AM

Lisa Wheeler

Real Estate Investor · Cape Coral, FL

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Oct 07 '08, 09:53 PM

Thank you Steph .. I read and follow your posts .. Great job ...

Ingrid; Yes that is what I am saying ... I am glad that you also see the price change when looking for comps ... I have really "beefed up" my due dilegence now prior to making offers to the banks ...

Now I am trying to locate sources for POF for my deals.

Again thank you both for the fast response and assistance

Edited: 06/26/2010 at 06:05AM

Stephani Davis

Real Estate Investor · Tampa, Florida

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Oct 08 '08, 03:04 AM

Hi Lisa,

I have heard that Coastal Funding will provide you with a proof of funds letter to submit w your offers. They do transactional funding on short sale and REO deals.

I have not used them, so can not vouch for their service, but I know of a few wholesalers who are using their pof letter to make offers.

Try Googling them.

Good luck,
Steph

Edited: 06/26/2010 at 06:05AM

Lisa Wheeler

Real Estate Investor · Cape Coral, FL

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Oct 08 '08, 07:05 AM

Thanks Steph... On a POF letter is it OK for the letter be a lttle higher then my offer .. If I get a POF for the exact amount; I can not resubmit a new offer immediately as I usually do .. But with a higher amount is the bank more apt to decline my offer because of my higher POF letter?
Thanks for your feedback .. Next week you will be a "Mentor" .... lol

Edited: 06/26/2010 at 06:06AM

Stephani Davis

Real Estate Investor · Tampa, Florida

190 posts
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Oct 08 '08, 07:55 AM

Hi Lisa,

Yes, it is fine for the amount in your letter to be over what you are offering.

I don't think it makes a difference to the bank- they just want to see that you have the capability of closing.

Steph

Edited: 06/26/2010 at 06:06AM

Greg Schickedanz

Real Estate Broker · Highlands Ranch, Colorado

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Oct 10 '08, 08:18 AM

Personally, I don't think it's a good idea to disclose to any seller that you have more available, than you are offering! Especially if your offer is below asking price. The bank may not notice, but their broker might. Why give them an opening to come back for more!

Edited: 06/26/2010 at 06:07AM

Tom Hughes

Residential Real Estate Agent · Palm Coast, Florida

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Oct 19 '08, 03:12 AM

Gee Greg, I think I should move to Colorado, in our market I don't think any of the Broker's would try to get the last nickel out of anybody. In Palm Coast Florida there are so many REO's and regular listings and so few deals that the Broker's go to the sellers and hammer them to accept. A friend of mine listed a property for $199,900 and presented the Bank with a $175,000 offer and then backed it up with comps that were listed 2 days after the offer came in at $149,000. Is your market really that good?

Edited: 06/26/2010 at 06:10AM

Phil *

Real Estate Investor · Connecticut

119 posts
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Dec 31 '08, 04:58 AM

I wouldnt worry about it too much. If they like your price, then they can buy it. If they wanted it for the REO price, then TOO LATE. Tell them your going to close on it whether they buy it or not.

Edited: 06/26/2010 at 06:48AM