Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
Since we are approaching the end of the year, is there any incentive for a bank to get REOs off their balance sheet before the end of the year, or does the timing not matter for them?
End of quarter and end of year to get LPNs, NPNs and REOs off of the books is what all of the banks(big and small) do with gusto. The beauty is that its twice as nice of a deal for real estate investors in that end of year is also end of the quarter all wrapped up together. If you have something under contract with them negotiating lower would likely be approved sooner than later....
End of quarter and end of year to get LPNs, NPNs and REOs off of the books is what all of the banks(big and small) do with gusto. The beauty is that its twice as nice of a deal for real estate investors in that end of year is also end of the quarter all wrapped up together. If you have something under contract with them negotiating lower would likely be approved sooner than later....
I actually do not know. I would suspect it has more to do with getting it off before they get an audit. They do not want those negative remarks on those.
I hope @Mary B. is right, I currently have an offer in on a short sale, am hoping they bite soon. Of course that means I am doing drywall, painting and carpeting over Christmas hehe.
@Dawn Anastasi A deal is a deal no matter what time of the year it is. In my opinion it's always best to make an offer than it is to wait for the right reason. I will say that I do notice as the summer season wraps up, you will notice REO prices begin to drop, but that does not mean you have to wait if you see a good property in a good area. BiggerPockets just released it's investment tools, I would use those to determine whether a deal is worth the look. Good luck.
Yes, you'll certainly find some motivated REO sellers around this time of the year. We've purchased some of our best deals in mid-December when the bank says, "We'll take it if you can get it closed by the 31st..."
Make sure you have a good title company who can pull title and get the deal done quickly...
Thanks for the feedback. I never know what banks are thinking but I do know they are businesses and have to deal with year ends and making their financials look good.
@Dawn Anastasi Hey Dawn, I have a different take as I spent 20 years actually working for banks. The answer is yes and no, it depends on the bank's financial position. The bank has to file their "call report" which details their financial position and impacts their cost of funds. If they sell at a discount, the call report takes a hit, therefore, they may actually want to wait until after the first of the year to sell if they can't afford the hit. If, however, they are having a strong quarter/year and know that they will eventually take the hit anyway, they may want to use the loss to offset some of the gains. So, in short, it really depends on the bank and their financial position. I hope that helps.