Making offers on Bank Owned Properties

Hi, I have made several offers that are great offers. All cash, over asking price and quick close with no contingencies. Each one has been ignored. It is always the same realtor that is doing the listings.

I already have a good relationship with my realtor ( he is also my property manager for my rentals)

I almost wonder if I should be making these offers through the bank listed realtor instead of my guy.

Last house was listed for 43,900. I offered 48K, all cash and no option and quick close. I was rejected twice for the same property.

The other house was 64k and I offered 68K-all cash, no option and quick close.

Same guy for these houses. He also has this irritating pitch, on all of his MLS listings. Multiple Offers received. Especially on day 1.

I am most irritated. Thanks for your advice.

J Scott

Real Estate Investor · Atlanta, Georgia

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Jan 21 '11, 10:12 AM

First, you say that your offers are ignored and next you say that you were "rejected twice for the same property."

There's a huge difference between your offers being ignored and your offers being rejected. If they're being ignored, this is an issue that your agent needs to take up with the listing agent or the listing agent's broker (or worst case, the Real Estate Commission in your state).

But, if your offers are being rejected, it may just be that they're not as good as you think they are. There are a few REO listing agents in my area who are very good at convincing asset managers to list well below market value to entice above-list-price offers and multiple offers in the first day or two.

If this is the case, there really may be multiple offers, and your over-list-price bids may not be the highest bids the seller is receiving.

J Scott, Lish Properties, LLC
Telephone: 770-906-6358
Website: http://www.123flip.com
http://www.123flip.com

Susan Charbonneau

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Jan 21 '11, 10:45 AM

Thanks J for your response,
Sorry for the confusion-My offers weren't ignored they were rejected. The offers were acknowledged each time.

If I am understanding you correctly, are you saying that these prices are placed low to get a bidding war going?

I hadn't thought of that. I don't know if that is what is going on or not.

It still is irritating. My thought process, is if you post a price and I offer you above asking price, I have as good a chance as anybody.

I am new to this investing thing. I have a lot to learn.

J Scott

Real Estate Investor · Atlanta, Georgia

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Jan 21 '11, 11:10 AM

Originally posted by Susan Charbonneau

My thought process, is if you post a price and I offer you above asking price, I have as good a chance as anybody.

Well, you don't have as good a chance as someone who is offering more than you are...which is most likely the case if your offers are getting rejected...

Something to keep in mind -- It's pretty rare that an REO is worth more than the list price, so the fact that you repeatedly bidding above asking specifically for listings by this agent leads me to believe that this agent is purposefully listing low to get multiple offers, and if you realize that the properties are worth over asking price, it's likely that other investors do as well.

Just hang in there, keep making offers, and everything will work out...there are times when I'll make 20 offers without any luck...then there are times when I'll get three accepted in a row...

J Scott, Lish Properties, LLC
Telephone: 770-906-6358
Website: http://www.123flip.com
http://www.123flip.com

Steve Babiak

Real Estate Investor · Audubon, Pennsylvania

4,267 posts
14 awards
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Jan 21 '11, 12:01 PM

Originally posted by Susan Charbonneau

Hi, I have made several offers that are great offers. All cash, over asking price and quick close with no contingencies. Each one has been ignored. It is always the same realtor that is doing the listings.

I already have a good relationship with my realtor ( he is also my property manager for my rentals)

I almost wonder if I should be making these offers through the bank listed realtor instead of my guy.

Last house was listed for 43,900. I offered 48K, all cash and no option and quick close. I was rejected twice for the same property.

The other house was 64k and I offered 68K-all cash, no option and quick close.

Same guy for these houses. He also has this irritating pitch, on all of his MLS listings. Multiple Offers received. Especially on day 1.

...

I look at the prices on these properties, and then I work the commission percentage (typically 5%), and then I see that commission will be split up how many different ways ... If you've closed on REO, you know how many different parties get a piece of the commission.

The part I put in bold is what I think will get your offers accepted! That increases the commissions to the listing broker (even if they don't do dual agency).

Susan Charbonneau

18 posts
1 award
50 influence

Jan 21 '11, 12:08 PM

I think what I would do would be to let my realtor know that for these bank properties, I would put my bid with the listing agent. Then if I get them, my realtor will then become the property manager for these houses. I may even have to throw him a little bit of money since he wouldn't be in the deal.

It would be cool if the bank stopped using this guy-I have heard grumblings from other investors that he keeps these good deals for his buddies.

I want to be his buddy too!!!

Steve Babiak

Real Estate Investor · Audubon, Pennsylvania

4,267 posts
14 awards
91 influence

Jan 21 '11, 12:20 PM

Originally posted by Susan Charbonneau

...I have heard grumblings from other investors that he keeps these good deals for his buddies.

I want to be his buddy too!!!

That what will happen if you buy using him as your agent!

Of course, the agent you were using is going to get cut out - but when you aren't getting any accepted from this listing agent anyhow, your agent is actually better off (no need to get you into the property, present offers, etc).