topic Re: Submit a high offer on an REO property if the bank covers closing costs? in Mortgage Loans

Submit a high offer on an REO property if the bank covers closing costs?

twoaklawn — Sun, 29 Mar 2009 17:38:31 GMT

If a property is a foreclosure and is now bank owned, is it typical for the bank to assist with closing costs to facilitate the sale? I have found a property that went back to HSBC back in December, and was put on MLS on 1/19/2009. The selling price was just dropped $10,000 on the MLS last week (3/23/09). After doing a drive by and checking out the neighborhood, I thought it was a good buy at the old price. Of course there might be an issue with the property not seen on casual inspection. I don't have my closing costs saved up yet, but this house would be a good fit for me. Is it unusual to offer more than the asking price in return for them covering closing costs, or does that just make it look like I'm an eager buyer? Just curious. This would be an FHA purchase by the way.

Re: Submit a high offer on an REO property if the bank covers closing costs?

Anonymous — Sun, 29 Mar 2009 17:45:23 GMT

While some banks have very stictrules about not paying closing costs or concessions/repairs, in thsi market most will. The issue comes in at whether or not the property will appraise for enough to cover the loans and the closing costs. If it is listed at 150K and will appraise at 165K then getting the bank to agre to closing costs and get a deal done is usually doable. Unfortunately you won;t know the appraisal value until after the ofer is submitted.

Re: Submit a high offer on an REO property if the bank covers closing costs?

ShanetheMortgageMan — Sun, 29 Mar 2009 18:37:28 GMT

Only issue is what mickie pointed out, if the home will appraise for the higher sales price still.

Re: Submit a high offer on an REO property if the bank covers closing costs?

twoaklawn — Sun, 29 Mar 2009 19:08:23 GMT

Interesting. There are 2 or 3 other houses for sale in the neighborhood, not foreclosures, and not nearly in as good shape as this one, asking price about $15,000 more than this one.

Re: Submit a high offer on an REO property if the bank covers closing costs?

ShanetheMortgageMan — Mon, 30 Mar 2009 02:51:18 GMT

Listings, or pending sales, are often asked to put in the appraisal by lenders these days - but closed comparables are still the best data used to determine a homes value.

Re: Submit a high offer on an REO property if the bank covers closing costs?

twoaklawn — Mon, 30 Mar 2009 16:55:36 GMT

Shane - Texas is a non-disclosure state in regard to selling price. How do they go about getting closed comp pricing? Do realtors and/or lenders have some sort of special database? Just wondering.

Re: Submit a high offer on an REO property if the bank covers closing costs?

ShanetheMortgageMan — Mon, 30 Mar 2009 20:28:36 GMT

Yes it's the MLS (private records), county records wouldn't be available (as I've found out myself).

Re: Submit a high offer on an REO property if the bank covers closing costs?

Anonymous — Mon, 30 Mar 2009 21:06:22 GMT

We had a bank owned property (not in forclosure technically) but a brand new home build and finished by the builder before they went bankrupt and sitting there for about a year. They just dropped the price 10,000 when we spotted it as it wasnt listed in MLS. (We actually had an offer on a forclosed home, same model for around the same price but lost out) We went in full price with 3.5% towards closing. The bank accepted without any counter. And we got the home for an unbelievable deal.

So I think it really just depends on the bank. This bank was in Minn. and we were in Chicago.

Message Edited by ospopo5 on 03-30-2009 02:06 PM