For the last three years I’ve been pursuing REO properties that are listed on the MLS, and while it’s been a great run so far, there are definitely some frustrations that come with working in this niche. For those of you who have incorporated the MLS into your acquisition strategy, you probably know what I’m talking about!
Following are my top four pet peeves about working with bank owned properties. Feel free to add to my list if you have some of your own!
Unanswered Phone Calls
I suppose this is not just specific to REO agents, but in any case it drives me crazy! I would estimate that over 60% of the agents who I call to inquire about their listings do not answer their phones or return voice mail messages. This perplexes me, especially since I do not work with a buyer’s agent, so when I make my offers I am giving away both sides of the commission to the listing agent. (Apparently I am not the only one who has experienced this phenomena- Julie Broad wrote a great article last week expressing a similar sentiment).
Three words I have come to despise: Highest and Best
The REO market has become increasingly competitive over the last three years. It’s gotten to the point that where it’s pretty much a waste of time to put in an offer on a newly listed property that is priced aggressively, because 99% of the time, the agent will come back with a response similar to this….”We already have 700 offers on this property (even though it’s only been on the market for twelve minutes), please submit your highest and best offer by noon tomorrow.”
Oops, I Meant to Change that to Pending!
I can’t tell you how many times I’ve submitted offers on bank owned properties only to have the listing agent contact me immediately after my offer has been submitted to tell me the property is already under contract (even though it is listed in the MLS as active). The logical solution to this problem would be to simply make a phone call to the listing agent before making the offer, however, it’s close to impossible to get them on the phone (see above).
Like I mentioned above, the REO market has gotten very competitive over the last couple of years, and as a result, some of the wholesalers and investors have resorted to playing dirty pool. One common strategy is to get to a newly listed property as soon as it hits the market, steal the key out of the lock box so no one else can get inside to look at it, and then submit an offer in hopes that it will get accepted before the key can be replaced.
There’s nothing more aggravating than driving out to look at a property only to find that the key has been stolen out of the lock box!
So there you have it- those are my top four pet peeves about dealing with bank owned properties. If you have any of your own that you’d like to add to the list- feel free to leave a comment below!