First Flip Offer / Counter Seller Shenanigans PropOffers.com

32 Replies

New to the Bigger Pockets community and starting our journey into real estate investing. We thought we would start with a flip. Found a house that we could pay cash and offered. It is a foreclosure and the offer process is managed by PropOfferes.com. This site is ridiculous. Feedback is painful. Timely replies are non-existent. Contact information is not available. The selling agent is not involved in the PropOffers.com site and not responsive to my agent. We submitted our first offer a couple of weeks ago. It was rejected. We re-submitted another offer. They countered we countered, they rejected. 

They dropped the list price of the home. The next day we submitted a new offer which they countered. We accepted this offer. They expected an increased amount of earnest money via certified check. The agent went into the web site and clicked the button to accept the counteroffer. We went to the bank and sent our agent a picture of the check and dropped the check in the mail. We then received the docs to sign online. The agent uploaded those docs and received an email that there were multiple offers and to submit the best and final offer.

We are in limbo right now and can't get anyone to tell us what is going on with the house. There is no customer support number and we are not getting anywhere with the seller or the seller's agent.

This is pretty typical when dealing with REOs, especially when putting in offers through online portals. Where did you mail the EMD? Your only recourse is waiting it out unfortunately.

Originally posted by @Nick C. :

This is pretty typical when dealing with REOs, especially when putting in offers through online portals. Where did you mail the EMD? Your only recourse is waiting it out unfortunately.

We sent it to the title company (Prism Title in Florence, KY) the seller indicated. 


My initial thought was contacting the real estate association/multiple listing service. If that didn't go anywhere, I was expecting to contact a real estate attorney. After calming down, I realize that I have to be patient. 


A more significant concern is if this is how the digital real estate age is happening, I'm not a fan. With digital transaction processing, how are these web sites able to accept/counter and accept new offers when the time-stamped events are part of the timeline?

 

This is just part of bidding on an reo through an online portal. Nothing sounds out of the ordinary. 

Just bid and wait.  If you start contacting others then then you are a problem child and they will pass on your offers.  Be the patient, follow the rules, sign the papers, do not give them grief customer:)

I agree with the above. It's not so much the digital age problem and more bank owned property issues. One person handles hundreds of cases, they have zero interest in customer service. The answer is whatever has the highest bottom line.... period. Even if that means listing it 5 times and writing off another months loss from their taxes. 

I'd get used to the digital real estate age, it's not going anywhere. Real estate as an industry is way behind the times in that regard, and will become more and more digital as time goes on. 

I have dealt with propoffers.com on transactions here in CT and nothing you mentioned is out of the norm in terms of what I have experienced. All of these online offer portals present some sort of challenge unfortunately. Work with an agent who has experience navigating these types of transactions and you should end up OK.

Hi Russell,

I am a listing agent that deal with propoffers.com frequently. Sounds like you or your agent jumped the gun a bit. Normally once you accept the sellers counter offer it still needs to be officially accepted/approved by the Seller.

Once that happens they will generate an addendum and I would normally send that to buyers agent along with the address as to where the EMD is to be mailed.

My guess is before the seller officially accepted your offer, someone else came in an submitted an offer. Which would in turn trigger a multiple offer situation where the bank asks for highest and best.

Originally posted by @Cory E. :

Hi Russell,

I am a listing agent that deal with propoffers.com frequently. Sounds like you or your agent jumped the gun a bit. Normally once you accept the sellers counter offer it still needs to be officially accepted/approved by the Seller.

Once that happens they will generate an addendum and I would normally send that to buyers agent along with the address as to where the EMD is to be mailed.

My guess is before the seller officially accepted your offer, someone else came in an submitted an offer. Which would in turn trigger a multiple offer situation where the bank asks for highest and best.

From my understanding, my agent sent us an updated contract to sign which she then uploaded to the Prop Offers site. I'm not sure if they submitted like it was a new offer. It wasn't until later that they received the email about multiple offers. But it sounds like my agent, or the seller followed the protocol you indicated. 

We are hopeful we have no reason to worry. The home was on the market for nine months and had no activity that interested the seller. I don't know if they received any offers. I'm sure there were a lot of showings. My agent indicated they expect a call from the title company tomorrow.

Highest and Best is usually a counter on prop offers. If the price just dropped then it may be multiple offers but I know for sure they always use it regardless. I made an offer on time for a property on the market 217 days. 1 hour after my offer I received the generic multiple offer email, I stayed at the same price and then the offer was rejected, guess they're not willing to let it go at that price yet. So you will get a multiple offer regardless if it is or not. Maybe somehow your offer got listed back as if it was a new one.

Today I received a couple of texts from my agent. First one is the that the listing agent indicated the seller had not reached a decision yet. 

Second, the listing agent received a text from the other buyer's agent indicating the property was in a 100-year flood zone. The listing agent disclosed that information to us. I asked my agent their thoughts on trying to sell that property after flipping it and in a flood zone. Their response was it would be harder to sell.

This transaction is our first flip. We know nothing will go perfectly. The last thing I want to do is hold a property that won't sell because it is in a flood plain. We withdrew our offer and are working another offer on a different property. Unfortunately, the listing agent is the same!

Thanks for your input! I appreciate it. I better get used to it, because most of these properties we are looking at are REO.

Maybe it's the location of where I live, but almost all homes are located in a 100-year flood plain and it's not that big of a deal.  I think you just have to carry flood insurance when you purchase the home and I've never seen it affect the sale of a house in my area.  

UPDATE: Looking at the assessor's site after the property eventually sold, we were still the high bidder by $2,000 if we stuck with it.

In other news, we were able to secure a property. It was also through propoffers.com. This time we relaxed and stayed patient. If it worked out great, if not on to the next one. We ended up getting an accepted offer. It took 30 days to close, which seemed slow for a cash offer, but we finally purchased our first investment property! We are now 2 months into renovations, a total gut job inside and out. Most work is happening on the weekend, so it's taking longer. We expect about 2 months before we are ready to put it on the market. The neighbors are curious and very appreciative. I take daily progress videos/pictures and hope to get a YouTube video posted shortly. 

Thanks for taking the time to share your thoughts on this post. It really helped me calm down and lower my expectations of the prop offers web site and REO properties in general.

@Russell Davis how’s your flip going , I see by your last post that you said you are about 2 months away from finishing .. but the post was 4 months ago .. 

so are you finished ? 
how did you do that on it ? 
Are you continuing to do more flips ..I suppose in this whole virus mass panic thing going on , you might want to wait for your next flip .. 

anyways .. I was just curious and was wondering if you have pics of before and after ... 

we always love seeing before and after pics ..,

I stumbled on your post because I am looking  looking at a propoffers property in central Fl area .. 

Although , I’m looking at using it as my personal home .. and turn the one I’m in now into a duplex rental .. 

Wishing you the best .. 

God Speed ! 

Hi Michael,

Thanks for asking...No, we have not completed the flip. In January, my parents died and everything stopped for a couple of weeks. We got back in the saddle and started up again, but only 1 weekend day at first. We have full-time jobs also and the property is a good 40-minute drive away. We have made decent progress:

  • Replaced a foundation wall/shored up the main floor
  • Put a 416 sq ft addition on the existing 2nd floor
  • Removed all stucco exterior
  • New siding
  • Replaced windows
  • Replaced doors
  • Removed rotted front porch and replaced with covered front porch
  • New steel roof
  • Knocked down a tree in the back yard that caught a power line and ripped the neighbor's mast off their house on a Sunday morning.
  • Replaced the stairs to the 2nd story adding an L so you don't bump your head at the top of the stairs
  • Framed 2 BR and a full bath in the 2nd story addition

Right now we are sitting at $20k for the house, with another $37k in repairs and carrying costs. We still have a long ways to go. We've talked to several local Realtors and they are estimating $140-150k when we are done, so we are expecting to net $125k. Expecting another $25-30k in repairs and carrying costs. 

We wanted to flip our first one hands-on to give us the experience to understand what it takes to flip. We have talked about what is next and we definitely want to BRRRR. We found an 8-plex that if it is still around we will probably get into, but contracting more of the work. It isn't nearly in as bad of shape either.

Good luck on your project,

Rusty


    Hello @Russell Davis

    I hope this message finds you healthy and well .. 

    I’m glad to hear you are at the very least , getting some hands on experience..it will certainly come in hand as your investing progresses .. 

    It’s always difficult to try to run a rehab while you are working 40 hrs a week somewhere else .. and even though 40 min away isn’t that bad .. it can still be hard when you’ve worked all day already ..

    I’m not sure if your budget allows , but ..

    You may want to consider hiring a project manager at this time , in order to move things along .. 

    I know you want to gain experience doing the rehab parts .. but, there have been a lot of success investors that still don’t know much about the rehab side of things .. they just have some good people working for them ! 
    You can always gain more experience as your investment career turns into a more full time thing ..
    I know when most start out , it’s one of the hardest things to learn .. to give up control and delegate tasks in order to shorten your timeline between flips , thus allowing you to free up more funds to do more flips .. 

    anyways , lesson over ..lol .. 

    Thank you for the update and it sounds like you are progressing ... 

    I wish you the very best ..

    God Speed ! 
    M. Short 

    Hey All, 

    I wanted to provide an update on our first flip. We worked weekends for the most part on a property that was roughly 40 minutes away. We had a personal family tragedy that put a stop to the flip activity for about 6 weeks. We then spent several months dealing with the estate and preparing another property for sale. 

    We got back to 100% on our flip during the summer. It feels like we've been in "one more weekend" mode for about 2 months, but we finally got it on the market. We bought it for $20k, put another $71k into it, and listed the property for $169,900 on 1/4. It received a full-price offer on 1/8 (less $3k closing costs and $600 home warranty). 

    We are looking for the next property. I've already had several people approach me about getting in on the next one.