Home Buying in Atlanta>Question Details

Arkla, Home Buyer in Atlanta, GA

Any recourse to contest sale price of a Bank REO priced at $300k, and subdivision comps are well below $150k.?

Asked by Arkla, Atlanta, GA Tue Sep 10, 2013

interested in purchasing a home REO that has a sale price of $300k, nothing around or in subdivision come near this price. Listing agent will not honor comps, or acknowledge the data in area for similar homes. Any recourse or way to consult with bank on value. I'm willing to pay $5k over highest sale in subdivision in last 9thmths. P.s.. .the home was foreclosure for $166k, tax value $147k..HOW IN HELL IS AGENT LISTING PROPERTY AT $300K. SPOKE WITH OTHER AGENTS, ALL PREVIOUS CONTRACT FELL THROUGH DUE TO BANK WILL NOT LEND OVER $200K FOR HOME. IT IS LOCATED IN EAST POINT! BEEN ON MARKET SINCE MAY.

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John Juarez’s answer
The bank is not willing to sell the property at market correct price at this time. The listing agent is at the mercy of the owner and cannot change the price without approval by the owner bank. If what you say is correct, no one will pay the price that is being asked now. Wait until the bank gets serious about moving the property and reduces the price to a reasonable amount and then make your offer.

If this is a HomePath property, do not allow the opportunity to buy the property with HomePath financing and no appraisal to sway you into paying too much. If so, you will have no equity until the value of the property rises.
0 votes Thank Flag Link Tue Sep 10, 2013
If banks were smart they would not have made the loan in the first place. You can argue with facts, you can argue with figures but you can’t argue with ignorance.

From a buying perspective it is never a good idea to fall in love with a potential property and this sounds like you have and as a result you should pass on this property. It is in appropriate for a listing agent to accept a listing far above market. That said, after representing 200+ banks in over 2000 listings I understand this situation. Banks don't believe the market, they don't believe their agents, they don't believe the buyers, they believe the appraiser and if the property gets a bad appraisal, they stick with it. While I never had a variance as large as you are alleging, I have been assigned over priced listings that were not going to sell at list price and where buyers were discouraged from making offers. Priced at $200, six offers between $150 to 160 should demonstrate to the bank that the market has spoken, but not if they have an appraisal at $200 and the offer acceptance guidelines state no acceptance below 90% of appraisal prior to 90 days on the market.

The relationship between the list agent and bank’s asset manager is difficult. Argue with the asset manager, refuse to obey the asset managers instructions and it’s not the loss of that one listing, it’s the loss of 20 to 100 listings a year. Is that consequence worth one buyer or one sale, get real. In that situation the a listing agent’s decision making process is highly biased toward doing what the bank and/or asset manager demands. When this happened to me, and overwhelming data supporting price or a buyer’s offer were presented, the asset manager frequently said, “Do you think I’m stupid or something” “I know but there is nothing I can do. We have an appraisal, its inaccurate but we are contractually required to accept a percentage of list price based on the time on the market.” I would also be told, don’t worry we know it will not sell, we can’t get a new appraisal for X months and we will not hold it against you for the property not selling and we will renew your listing till it sells.

I can tell you when you as the listing agent refuses a listing someone else will take it and usually all your other listings. This is not speculation, it’s happened to me many times. Chances are you and the sale of this home are insignificant to the listing agent and this sale is as important to BoA as a grain of sand is on a beach. There are tens of thousands of homes to choose from, unless you know there is drug money stashed in the walls or gold buried in the back yard, find another home.

Bruce Ailion,
RE/MAX Greater Atlanta
An Atlanta Real Estate Expert Serving Clients Since 1979
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Attorney
2050 Roswell Road
Marietta GA 30062
404-978-2281 Direct
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678-760-6266 Buyer’s Agent Adam
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http://www.LocationLocationLocation.com
The Linked In REALTOR
http://www.linkedin.com/in/bruceailion
1 vote Thank Flag Link Tue Sep 10, 2013
You're wasting your time and personally you should allow the listing agent and the bank to choke on the listing.

Here's what you need to understand, the stupidity of asset managers who work for the banks is only surpassed by their arrogance. You should also read the link below as rarely if ever are foreclosures the "deal" buyers assume them to be.

Lastly as others have indicated any seller can ask any price they want no matter how absurd it might be.Buyers have the recourse of laughing in the faces and wishing them all the best.
1 vote Thank Flag Link Tue Sep 10, 2013
With an REO property, the seller is free to list to property at any price they wish. A Buyer cannot force a Seller to accept a certain value.

It would be VERY odd though to see a property listed at nearly twice what recent sales in the neighborhood are closing for. The Listing Agent NEVER make the final decision on List Price, Offer Price, Price Reduction, etc. They can advise the Seller all day long, but at the end of the day, the decision lies with the Seller.
0 votes Thank Flag Link Tue Sep 10, 2013
It sounds like that house isn't really on the market. If the bank won't accept a reasonable offer, it's time to walk away and find another house. If you like the neighborhood, maybe your agent will canvas the area for you to see if any of the neighbors are willing to sell. Of find an agent that will!
0 votes Thank Flag Link Tue Sep 10, 2013
I am an REO agent, call me 678-632-5218
0 votes Thank Flag Link Tue Sep 10, 2013
The bank or any seller can ask as much as they want for a property. It doesn't mean it will sell. For some reason, the bank has a higher evaluation on that property. You can submit an offer with comps and the listing agent can submit it to the bank. The listing agent doesn't make the final decision on the price. They are the messenger to the bank. (I've listed REO and my opinion is only one of many that the bank hears.) You will not have an opportunity to consult with the bank directly. You might just want to wait to see if the price gets reduced to what you are willing to pay.

Best wishes.

Jen and Mark Bowman
Keller Williams
941-840-0117
0 votes Thank Flag Link Tue Sep 10, 2013
If what you write is totally accurate, Arkla, then apparently the Lender doesn't want to part with the home for less than a price well over market, tax assessment and likely appraisal value. Move on, IMHO, as there are plenty of other properties begging for a deal. Please call, text or email if we can provide further assistance. Good Luck!

Michael Hammond
SellsRealty@gmail.com
404-538-5499

http://www.georgiamls.com/agentsite/index.cfm?SiteID=HAMMONDJOHNM

http://www.chapmanhallprofessionals.com

http://www.SellsRealty.org

http://www.city-data.com/

http://www.greatschools.org/
0 votes Thank Flag Link Tue Sep 10, 2013
No buyer can dictate to any seller how much they are asking for their property. If the seller does not get the price that they want, they have every right to let it sit there for as long as they want until the buyer who is willing to pay their price comes along.
0 votes Thank Flag Link Tue Sep 10, 2013
YOU ARE CORRECT, BUT NOTHING IN SUBDIVISION IS FOR SALE NEAR $300K...SAME HOMES UNDER CONTRACT AND SOLD , AS STATED FOR $140K-$155K...NOWHERE NEAR $300K. APPRAISE VALUE IS NOT EVEN $300K.
Flag Tue Sep 10, 2013
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