Is there a general rule for submitting an offer on an REO home

[Brenda Sacchetto]

I am a new potential investor. There is a foreclosed home in an upscale neighborhood that is listed for 1,100,000.00. I haven't viewed the home yet but the agent said it was a drug house where the insides, while nice have been stripped of everything. The home is 6,000 sq. feet and currently vacant and has been since July 2013. It is in Orange county Ca. My question is what is a rule of thumb on making an offer on something like this? I'd like to offer 550,000.00 is that crazy??? Anybody know?? Help?!

[Chris Piper]

@Brenda Sacchetto There really is no rule of thumb when dealing with any bank. All you can do is try to get the best comps you can find and run your numbers to see what your MPP is. I typically make my initial offer at 85% of my MPP, and go from there. If you are putting in your offer at the end of the month, end of the quarter, or end of the year(like right now), you should have more flexibility in your offers because that is when banks REALLY want to get the REO's of their books.