Best deals REO's?

Question

Brent Coombs · Answer

@Bryan Levine, I hope you've got your $265k Buyers locked in before you offer the Bank $240k!

(ie. ones that are also OK with your strategy of tricking the Banks into thinking YOU'RE the Buyer)...

Bryan Levine · Answer

@Ivan Vargas @Lucas Machado @Brent CoombsI have been using several bank websites to connect to their REO sections. form there i have identified several realtors who deal specifically with that. From there i identified one or two who seem to be hungry. They really did not have anything at the moment they thought was worthwhile.

I analyzed a couple deals and came up with numbers that indicated to hold off for now. For example I showed a .7% percent return on money on one deal and on another I showed monthly cash flow to be $240 in the red.

Problem was, I got a little disenchanted and did not analyze anymore deals that week. I ought to have kept going...

What do you think about my strategy to locate REO's ?

Ivan Vargas · Answer

@Brent Coombs I am not saying the banks should "give away money". In response to the OP, there are great deals to be found in REO's, however they turn into not so great deals when the competition comes in and drives the price up.

Some banks, as the OP mentioned, set their prices at market - estimated repair cost which depending on actual repair cost might end up being equal to or higher than ARV.

For example another REO I went after: asking price was $265k, and I figured around $25k in repairs. ARV was around $309-319k. I offered $240k and of course got rejected.

At $265k that would be great for an owner occupant who planned to live in the house and just wanted to customize it to their liking.

Lucas Machado · Answer

@Bryan Levine as @Ivan Vargas stated, there is a lot of competition here driving up prices. As such, the best deals are the ones that you get yourself, where there's fewer competition.

Brent Coombs · Answer

@Ivan Vargas, why should Banks give away money with "better deals"?...

Ivan Vargas · Answer

REO's should be the better deals. Some are priced well below market here in Palm Beach however there is so much competition that the offers go way above asking. Last one I went after was asking $109,900 I offered $126,500 and got beat out by another who offered $135k. ARV would have been somewhere in the $220-250k range and from my walk through I figured 40-50k in repairs (needed a new roof).