Negotiating REOS

[Jack Srimani]

While purchasing a REO property if my inspection shows a lot of issues can I negotiate price with the bank. Also if I am in a situation where the inspection reveals multiple issues that requires major expenses to put it in a livable condition and I decide to walk away from the deal then do I lose the earnest money. Thanks for any help. Regards,

[J Scott]

Jack -

It's going to depend on what your contract says. If your contract grants you a period of time to evaluate the property (called a "due diligence" period) then yes, you have the right to try to negotiate with the seller during this period of time or even to walk away from the deal and get your earnest money back.

If your contract doesn't stipulate a due diligence period, you can still try to negotiate, but the seller is entitled to your earnest money if you walk away, so you're unlikely to be successful in a negotiation if this is the situation.