Foreclosure in Kentucky>Question Details

Grace, Home Buyer in Kentucky

I am placing a bid on a foreclosed home (a bit under what the asking price is). I also just found out that

Asked by Grace, Kentucky Tue Jul 8, 2008

there is another offer on it. I will be paying half of the total price (and taking a loan for the other -- have been pre-approved w/ excellent credit). Is it better to just pay the asking price (which would better my chances of purchasing it), or do banks also take into account the credit & %down of the buyer before deciding? (Or do they just go w/ the highest bidder?) thanks!

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It might help if you were to get pre-approved for a loan from that bank if you haven't already done so. If the bank stands to gain more from selling you the house AND selling you the loan they might take your offer even if your offer is slightly lower than the other.
0 votes Thank Flag Link Tue Jul 8, 2008
Hi Grace,
Sounds like you might not be working with realtor?
I've assisted serveral buyers with foreclosures in the last year and what I've found that the person on the negotiation side for the bank usually does not make their decisions based on the buyers credit. Although, it will definatley be a factor when your bid is accepted. If for some reason the winner will not be able to qualify then the bank usually drops that bidders offer and moves on to the second offer. Also, keep in mind that just because there is another offer does not always mean they are competing offers. The other offer might be offering full price but asking for down payment assistance and/or closing costs which would effect the banks bottom line.
As I tell all my buyers you should always make your best offer first (whether it's a foreclosure or not) because you might run the risk of loosing the home to someone else who wants the house just as bad and has made their best offer. If the home has been on the market for quite a while without any drop in price then make a lower offer but beware that if it's too low you might not even hear back from the lender!

Hope this helps! And call one of your local realtors so they can help you through the process, it's a jungle out there!

Karen Taylor ERA Chamberwood Realty
karen@yourtaylorteam.com
0 votes Thank Flag Link Tue Jul 8, 2008
With credit being equal in that most foreclosures aren't going to consider a preapproved buyer anyway, they start with the highest bidder. If you don't happen to be the highest bidder they will keep you "on file" as a back up if you choose. Most lenders list the asking price well below comparables, that doesn't mean you can't make an offer lower (and get accepted!) but when other offers are in play it always come back to them cutting their losses. Hope that helps. Good luck!
0 votes Thank Flag Link Tue Jul 8, 2008
I do know the original price for the house is below the asking....
0 votes Thank Flag Link Tue Jul 8, 2008
Hi Grace
Does a research first before put a bit on asking price, the price for the house could below asking price.
0 votes Thank Flag Link Tue Jul 8, 2008
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