I just saw a bank owned property come up that I'd like to put in an offer on. Is there any advantage to making my offer through the bank's listing agent? for example, will they get paid a larger commission and possibly be more inclined to push the deal? Or am I just better submitting my offer through an agent of my choice?
Also, with bank owned properties if it's a good deal is it expected that I offer list to have a chance at getting the property?
Thanks in advance.
yes, you are on the correct path.
Personally I do it all the time. Making an offer through the REO agent gives them a larger commission and since many of the commissions are such a low dollar value it gives them more incentive to work with you and to provide more information. The problem I have is when making multiple offers is keeping each of the REO agents linked in my contact to the offer / address.
I just got an REO property under contract using the listing agent. It worked out very well. Originally, the bank did not want to budge on price. We got an estimate from a contractor for repairs and she started working with the manager at the bank. She even used the same contractor to get the bank an estimate to weather proof the property for the winter. After all was said and done, she was able to convince them to come down enough to make the numbers work for me.
If you know your numbers, then there probably is no benefit. However, investors and agents tell me all the time that they lost out on a deal because they didn't use the listing agent (in their head). I ask what happened and it's always a similar story.
- The seller asked for highest and best. (Lets say the list price was $100k)
- The buyer offered $95k, Highest and Best.
- The property ended up selling for $96k.
I ask the buyer/agent if they would have paid $97k .. and they either say:
- 'No', and I say "well then you weren't the highest bidder now were you?" .. and the conversation is over.
.. or ..
- 'Yes' .. at which point I point out the fact that they did not submit their HIGHEST AND BEST .. and that's why they lost out. What happens is, a buyer will make their offer just trying to guess what other buyers might offer .. and they lose. It's almost as if a buyer is suddenly willing to pay more at the direction of the listing agent. The buyer is always trying to get away with a better deal, but the fact is, if there's multiple offers you need to come in with your 'walk-away' price.
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