BiggerPockets

I'm interested in purchasing a quad that is listed on the MLS. The owner has had it for many years and re-fied it with the same lender over the course of about 30 years. She now owes more than the offers coming in. It was listed at 140k back in summer and now it is down to 125. I purchased a double across the St for 76k as a short sale about a year ago. Using price / sq ft comparison (76k/2100sq f = 36$/ sq ft * 3500 sq ft = 126k. The listing agent is unwilling to work with me in the 100 ballpark, he won't even write it. I could go to another agent to submit the offer, but I'm afraid he'll keep it from going anywhere. The house has been listed for months and the notice of foreclosure was filed last year. Is it possible to make an offer on the note directly to the bank and then work with the current owner (elderly somewhat disabled, living in one of the units) to sell me the prop for what she owes? Any other ideas or advice on best way to proceed would be appreciated. Thanks! MC

Indeed. The LA's refusal is a big red flag, since they should present all offers and it's up to the owner to accept or reject. (can she even though she's "somewhat disabled?")

But I would try another agent if you know one and have it sent that way and see what happens...you might get better information as to why things are what they are and then can go from there. (possible short sale intention right now if nothing high enough is accepted?)

Now as for the note, depends on what bank owns it...if it's one of the big guys (BOA, Chase, Wells, etc.), you're not going to have much luck getting through to them and buying it as a one-off. Doesn't mean you can't try if you really want to, but the odds are stacked pretty well against you.

Personally if it wasn't a short sale and the LA isn't willing to work with anything, I'd go talk to the owner direct! Heck you know where she lives :) and you might be able to work out a creative/better deal that way...

Before we all send the hounds after the listing agent, we might want to give them a little benefit of the doubt.

In my area, with the prevalence of short sales, it is common practice to list the property far below market value, generate a ton of offers, and submit the "highest and best" to the short sale lender(s). The property generally still shows as "active" while this is taking place. So, if you are asking to write an offer at 100K, and the agent already has several offers at or above 125K, I don't see how the agent is doing anything but saving time, yours included. I mean, maybe he should still accept yours as a backup offer, but this might not be quite as bad as you're making it out to be.

I contacted the listing agent to schedule a showing and expressed my willingness to put a cash offer on the home August of last year. I explained my justification on price based on experience with the local market and he got very upset. Basically we parted ways with me saying "Well, I guess I'll be putting my official offer through another brokerage" I was rather ticked when he refused to put a low 100's offer. He told me the bank would never do it. I said it was better than foreclosure...

Sounds like you may well want to use another agent, one who can play good cop, to balance out your bad cop ($100K ridiculous!).

And $100K offer on a $125K distressed listing in 2011 is hardly an unreasonable offer.

indeed. I'll probably go through Re-Max, I'm sure they miss me ;-)

Yes, I have looked up the bank via the county
There are tenants, though I doubt they are paying much if anything in rent. The owner is a tenant and she has medical issues. She is older, I don't know if she works, her husband died a few years ago. They've held the house for some time, and increased their borrowing with the same lender to it's current level (150k) They have issued notice of foreclosure beginning back in October of 2010

In some states the seller can give the Agent the right to turn down offers if they do not meet a certain criteria. It's rare and I believe it requires a Limited Power of Attorney. So this might be the case, with the seller having health issues.

If Remax does not work, submit the offer to the Listing Agents Managing Broker and include an email or letter from the Listing Agent saying s/he refuses to submit the offer.

hahahaha. Another "great" LA (sarcasm).

115 for a quad (even if you let everyone there stay as is presuming rents are paid OK) works out nicely.

Worst case there's some dickering on the fine points of things. At the same time you do seem very interested in getting this either way, so it might just work out for you regardless.

Good luck!