HUBZU, - does it make sense?

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HUBZU, - does it make sense?

Oscar Olaussen
Frederick, MD · Member since 2013 · 4 posts · 0 votes

I have a bought some properties on Hubzu, and as many of you have stated, you have to be patient to get a good deal.
After over a year watching and dealing with them, I can still not figure out their business model. What I have seen so far, it just doesn't make sense to me.
We would all think the objective for the seller is to get the best possible price for a property, but as far as I can see, there is no logic in their strategy.
Does anyone here have some inside knowledge or facts of their business model???
And who are these people who run the actual sales of the homes? Failed used cars dealers????
My last deal on Hubzu and as all the others, have happened as follows:
Property listed for $149.900. Minimum bid: $105.000 Result: No experienced investors are bidding as we do not want to pay the Premium.
Property relisted for $144,900. Minimum bid still: $105.000. Some amateur bid $122.000. (A total of $127.000 incl; the Premium). Hubzu does not accept the bid and the property now goes to "Highest Offer" and with no Premium.
Highest Offer listing has now a starting offer at $88.000 A few low ball offers comes and after watching it for a couple of weeks, I offer $100.000. A new offer comes in at $112.000 and I go to $110.000. One week later, Hubzu counter me with $140.000!!!!
Wow, what a deal!!!!!! I reject and the listing is reset with no offers. So here we go again, starting all over. Long story short, I now offer $89.000 and 3 weeks later Hubzu (the bank) accept.
Like I said, ALL my deals with Hubzu have gone down the exact same way. Who in their right mind came up with this business model????
Does anyone here have some inside fact and knowledge of Hubzu sellers???

Thanks,

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Mark Ferguson
Flipper/Rehabber · Greeley, CO · Member since 2013 · 2k+ posts · 1k+ votes
13y

Here's some history on hubzu from an agent who used to work them hen try we're a different company.

Hubzu used to be gohoming which is the auction site for altisource. Altisource used to be Ocwen. Ocwen and altisource are technically different companies but they are owne by the same people. Ocwen buys properties/services them and altisource values and sells them. I would estimate 99% of the properties on hubzu/gohoming are owned by Ocwen/altisource. I see they are trying to branch out to other sellers now, but this is why the offer them is so wacky. Everything is outsourced to India.

I used to list for Ocwen four years ago them they switched their model to one agent per state an the auction idea. The listing agent does nothing but put the house in mls. They get their vales from bpos that other agents do and the people from India decide what offers to accept.

Ocwen keeps buying pools of assets from large banks. They bought gmac and one wests assets as well as many others. Their model is to sell them as fast as possible and take a quick profit.
FYI, when they do the initial auction, they won't accept anything unless the reserve is met. Your wasting your time bidding low and hoping they will accept it.

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  • Todd Ruckle
    Newark, DE · Member since 2015 · 1 post · 1 vote
    11y

    We just had one where they listed at 100k, sat for a few weeks, then they reduced to 87k. We offered 70k, they rejected the offer. It sat for weeks, then the reduced to 80k, we started at 67k, they rejected it. A week later they reduced to 70k, so we offered 64k. They rejected, then reduced to 65k. We bid 62k the next day and won. It is crazy how they work

    1Reply
  • John D.
    Rental Property Investor · La Quinta, CA · Member since 2014 · 1k+ posts · 779 votes
    11y

    I've bought a couple hubzu places, and have bidded on half a dozen or so.

    I'm curious as to everyone's opinion.  I've got a place on my radar where the starting bid is reasonable, but the price they will actually take is way out there.

    Should I continue to just bid the minimum each time they re-auction it, or would it be better to not bid so they drop the starting bid (and hopefully their expectations).

    Assuming I am the only bidder, which has been the case to date.

    0Reply
  • Clary Roberts
    Wholesaler · Pine, AZ · Member since 2014 · 40 posts · 6 votes
    11y

    I just placed my first bid 7/4/15 on a property.

    I'm new to not only auction sites but fnf in general, have yet to do my first one.

    There is no "buy it now" price..and I'm the only one who has bid so far, 5 days left.

    I am a realtor in the area so I have a feel for the value of the property.

    Looking at tax records shows on 3/12/15 the bank paid $247,988 for this...was that what was owed on it?

    I bid $133K and feel the house is worth after rehab about $250K.

    Guess I'll learn the auction/Hubzu process by jumping in with this one....

    0Reply
  • Robert Martin
    Residential Real Estate Broker · Terre Haute, IN · Member since 2016 · 17 posts · 13 votes
    10y

    I just closed a Hubzu property for my investor client 2 days ago.  I am not a fan of the auction websites but every once in awhile they have some good deals and I will get my investors hooked up.  Most everything is done in India and the asset managers will all have Indian names.  Altisource.Ocwen will most likely be the owners of the property and they also own the title company that will give title insurance on the property.  My closing took place a week and a half after the bid was won and we had no issues.  These sales do generate a lot of paperwork but once you have done a few it's very easy.  The prices all coincide with the days on the market.  What they will accept will be dependent on how many times it has been on auction and NOT sold.  That's pretty much the key.

    1Reply
  • Account Closed
    Tampa, FL · Member since 2016 · 55 posts · 4 votes
    10y

    @Robert Martin  Does this website require an agent/realtor involved? 

    0Reply
  • Robert Martin
    Residential Real Estate Broker · Terre Haute, IN · Member since 2016 · 17 posts · 13 votes
    10y

    No, it doesn't require one but I can tell you that the paperwork is grueling and you will end up having to email the closing documents back to Altisource, which will be around 20+ pages.  I have a client that went on his own and won a bid through them and 3 weeks later he is still trying to fulfill their requirements.  Had he come to me, we would have closed already.  But no, they do not require a Realtor, BUT most of the sales DO offer a commission to the Realtor and no huge buyers premium so why not let your Realtor make sure that you get everything in and done in a timely manner and save you the headache?

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  • Mary E. Taylor
    New to Real Estate · East Tennessee · Member since 2022 · 29 posts · 3 votes
    4y
    Quote from @Robert Martin:

    I just closed a Hubzu property for my investor client 2 days ago.  I am not a fan of the auction websites but every once in a while they have some good deals and I will get my investors hooked up.  Most everything is done in India and the asset managers will all have Indian names.  Altisource.Ocwen will most likely be the owner of the property and they also own the title company that will give title insurance on the property.  My closing took place a week and a half after the bid was won and we had no issues.  These sales do generate a lot of paperwork but once you have done a few it's very easy.  The prices all coincide with the days on the market.  What they will accept will be dependent on how many times it has been on auction and NOT sold.  That's pretty much the key.


     Would you say at 75 days they are willing to negotiate? We have watched the property drop 20k each month and the house has said under review now since Friday with us being the highest and only bidder.

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  • Robert Martin
    Residential Real Estate Broker · Terre Haute, IN · Member since 2016 · 17 posts · 13 votes
    4y

    I have had them call me and/or email me with the minimum amount they will accept.  Most of the time the figure is lofty at best.  After 90 days they start sending those offers to the bank if they have not got a sale previously.  I can't say for sure, but I seriously doubt that banks get all of the offers that are lower than their minimums.  Asset managers are overwhelmed and many have never sold real estate so they do not have on the ground experience.  So it's strictly a numbers and days on the market type of negotiation.

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