Best way to submit a low offer on a listed multi-family

[Dan Cioaca]

I have a 3-unit property on which I'd like to make an offer and I'm thinking of how to maximize my likelihood of having it accepted. 

A few details:

+ house has been listed, de-listed, and re-listed 3 times (presumably with different agents?). First listing was 13 months ago, the price was cut 4% after first week, no changes in price since, just relisted repeatedly (the market has softened a lot since then). Current zestimate is 85% of asking price. 

+ owner is an absentee out-of-state landlord who gained ownership through estate/probate. There have been tax liens and other signs of managerial negligence over the past year.

+ the property is in massive need of a rehab. The elderly former owners were elderly and didn't care for it probably, and it hasn't been updated in 40 years. No building permits recorded since records started in 1980.

+ a reverse mortgage was taken out against the property and is currently going through foreclosure. The LTV is small, maybe 25%, and there's a lot of equity headroom, but Lis Pendens was filed earlier this year.

+ unit rents are at 25-40% of market rents, and seemingly rented to family members or friends uneconomically. 

My goal: all cash initial offer of 60% of asking price, with a MAP of 75%, few contingencies, fast closing. I have the cash to close and would prefer a mortgage to fund rehab, could be secured after closing. 

Given the listing history, the owner seems stubborn about asking price even after failing to sell during the hot 2021 market and seeing prices drop over the past year. I'm hoping they would be open to a fair offer at this point to get the lender and tax man off their back since in a few months they probably won't be a position to control the outcome after foreclosure completes. Given the property is listed on the MLS through an agent, what's the best way to make an offer to maximize my chances of closing at my desired price? Should I try to get the listing agent on my side to avoid it going to auction and them losing their commission? Should I find and contact the seller directly? Would a formal written offer on official letterhead carry additional weight?

[Patricia Steiner]

With a reverse mortgage, the full amount owing is required to be paid off in full.  IN FULL.  The reason it's probably been on and off the market is that the balance owing isn't what it is currently worth.  A reverse mortgage changes the whole scenario - and there's no exception.  To make this even more "entertaining," know this:  "A con of a reverse mortgage is that the loan balance increases over time as interest on the loan and fees accumulate."

There's a reason properties don't sell...and whenever you see "reverse mortgage foreclosure," BOLT.

Time to go hunting again...