A few helpful hints. First, see what bank or institution holds the title to the home, and see what their history is as far as selling foreclosures. Usually the smaller banks have more leeway.Yiliumn said:
Second, see what foreclosuresonlyare going for in your area, because that is what the bank/title holder is going off of also. It"s some desk jockey in White Plains, Nebraska who"s never seen the home before in person and who"s evaluating the home based purely off of comps.
Thirdly, come in all cash if you can. If not, at the bare minimum pre-qualify. Banks are looking to dump these properties with the least amount of hassle possible.
Fourthly, look at how long the property has been on the market. Is it a new listing? Don"t bother, the bank doesn"t have a good sense of what the true price point of the property is yet and are less likely to deal. Has it been on the market for over a year with re-listings at a lower price a few times? Bingo. That"s a clue the bank has no fucking clue what the true value of the home is, and you can come in and make the argument that what you are offering is the true value, obviously if they were at the right price point the house would have sold already.
The most recent property I purchased was the last scenario I showed you. It was a foreclosure that had sat on market for over a year, it was de-listed and re-listed 3 times. I went through my real estate agent and asked to speak to the bank"s loan officer personally (this way my agent would see I wasn"t going behind her back, we have a good working relationship, and she would get her commission anyways. But I felt it was important to speak to the officer personally because I would be more persuasive). I told the loan officer that I was an all cash offer, "X" dollars was all I was willing to offer, take it or leave it, the reasons my offer was so much lower was because the property had been vacant for so long and since I was buying as-is chances were I would need a lot to renovate it. Furthermore, I told him we both understood this was a toxic asset that the bank would want off the books, and that he and I both realized this was likely the best offer he would receive in the next 6 months or so. Did he really want to risk going with someone else with a possible marginal credit history, maybe a traditional 20/80 loan, only to have that person dump (foreclose) the house after if they didn"t like it?
He accepted my offer. It still took about 6 months to close though =) I got a home that was originally listed for $720,000, then re-listed all the way down to $495,000, and which I purchased for $322,400.
By the way, and I have nothing to show you if this trick works or not, but I like to offer an oddball number as a bid. For example, $322,400 instead of a straight number like $325,000. To me, it seems like you have put more thought into it instead of just pulling a number out of thin air. When they ask me "how did you arrive at that number?" I would say "because based on the research I"ve done on the property and the surrounding area, this is the figure that I"ve calculated". I just think it looks more believable when it"s some screwy number than when it"s a nice whole number. Again, no evidence to show this makes any difference, but it"s something I like to do.
