Foreclosure in Charlotte>Question Details

lakesedge, Both Buyer and Seller in 28031

What should I offer on a residential land foreclosure?

Asked by lakesedge, 28031 Tue Aug 14, 2012

I am interested in purchasing an REO residential lot in a subdivision. The subdivision has 4 homes currently with the potential for 50. Lots are min. 1/2 acre each and are for sale but not selling very fast....there is no new construction going on. There is one REO lot. Original price 56,000. Value now 26,000 according to the appraisal card (last purchase price 26,000 in 2008). The bank is offering this at 14,500 and it has been on the market for at least 6 months, probably closer to 8, minimum. What should I offer? How can I present it? I was thinking of offering 8500 and also saying to the bank that I will do a construction loan with them, or pay off the land with the construction loan, etc. etc. What should I do?

Help the community by answering this question:


Remember that you are not trying to buy property from a "human", but from a corporation. The Bank will not care that you are willing to do a construction loan with them. The REO department and the mortgage lending departments are two separate entities and do not work together. All the REO department cares about is the bottom line of what they can get for a, particular asset (property). The asset managers have matrices that show what the bank will willing to take for an asset on any given date. Since this lot has been on the market for such a long time, the matrix for that property will give a lower price than it did even a month ago. You will need a realtor to present your offer to the bank. Most likely, the offer will be made online. Again, the bank will only be interested in its net after the expenses on the sale. What you plan to do with the land after purchase is of no concern to the REO department.

It never hurts to make a low offer and see what the bank will do. I am no fan of leaving money on the table! Best of luck to you!

Kathleen Turner, ABR, CRS, ePro
Keller Williams Realty
0 votes Thank Flag Link Mon Sep 17, 2012
I think you should get with a land agent and let them assist you with valid help that accommodates the land value in the area you are looking in. Land is not being bought as fast as standing structures, but it is being bought and at great prices. Banks are looking to unload non performing assets before end of the year and this may be the best time and shot you have. If you need help finding an agent let me know and I will be happy to refer you to someone.
0 votes Thank Flag Link Fri Aug 31, 2012
Good afternoon, Lakesedge:
This amount is probably below the minimum mortgage loan amount for most banks. You may want to check with a credit union, or a local bank, but on land this low priced, you should get a personal loan or cash advance and figure out how to make an all cash offer and close in 10 to 14 days. $8,500 seems like a reasonable first offer. There are a number of considerations in making an offer. If you want to discuss details, I'd be glad to help. If you appreciate an answer, please give "thumbs up". For the most helpful answer, please say thanks with a "best answer" click.
0 votes Thank Flag Link Wed Aug 15, 2012
The bank will not give any weight to your telling them they will get the construction loan. First of all, the department handling the foreclosure and the mortgage lender department are 2 separate entities and have nothing to do with the other. Secondly, you could always change your mind on lenders, after the fact, so your word means nothing. Foreclosure business is strictly numbers to the bank. They have a matrix as to what they will take for a.given property, with that amount going down over time. Go ahead and make your offer and see what the bank comes back with. Land has been very difficult to sell inthe last few years, as land and consteuction lians were near impossible to come by. They may be ready to unload the property and take your offer gladly. Best success! Kathleen Turner, ABR,CRS,ePro, Certified Paralegal
0 votes Thank Flag Link Wed Aug 15, 2012

it is tough for any of one of us to give you an estimate as to what to ask for the land. The best advice I can give you is to secure a buyer's agent to represent you. There are soem other variables you need to consider when purchasing a lot. Doing a comparison anaylisis is the first for that subdivision. Location fo the lot is another. Some lots are better situated than other lots. Also is the water and/or sewer already hooked up from the street?

Though there are minimum lot sizes you are going to want to request the original covenants and restrcitions the builder had in that subdivision. Just ebcuase the lot is now bank owned the covenants and restrcitions stay witht he land. There amy be soem restrcitions (most likely there is) on building size, type of house, square footage, materials used for exterior, etc..... Those all play a factor into the value of the land versus your cost to build a suitable house that is in line with the neighborhood.

offering to finance with the bank is not probably going to matter to them. They are looking at this as a separate transaction and are going to view it as if you are not going to get a construction loan with them... I have dealt with banks that have had foreclosed properties for sale and the buyer had secured financing with that bank to buy the house and they did not care.

If you would like some help with this please feel free to either e-mail me at or give me a call at 704-519-7895.

Dave diCecco
Coldwell Banker United
0 votes Thank Flag Link Wed Aug 15, 2012
Good evening, lakesedge!

From the information you have provided, it is hard for me to give you my opinion on price because we typically as Agents base the Offer on the Comparable Sales in that Community and/or Area. If you Offer much lower of a price, cash is definitely the preference for any Bank, especially when it comes to dirt.

I do work with several Regional and Local banks in Listing their Foreclosure homes and lots. The land market is definitely picking up as Builders and Investors are coming back and buying these properties up. If you should need some further assistance, please feel free to reach out to me.

I strongly urge you to secure a Buyer's Agent to represent you in this transaction. Also, make sure you review the Coventants and Restrictions of the Neighborhood. Sometimes it gets tricky with the Building Restrictions depending on the state of the Neighborhood. To further elaborate, who is the Architectural Review Board, the Developer? Are there specific Building materials in the CCR's?

Have a great night and best of luck!
0 votes Thank Flag Link Tue Aug 14, 2012
I would have to pull exact address and comps to get a more accurate answer for you. Give me a call or email me and let's talk about submitting an offer.

Abby Nelson
0 votes Thank Flag Link Tue Aug 14, 2012
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