Home Buying in 93311>Question Details

Justontheway, Home Buyer in 93311

HELP! We have made offers on 2 homes at 10k above asking price & got beat by lesser cash offers. What more can we do? We have pre-approval on

Asked by Justontheway, 93311 Fri Nov 18, 2011

loan!

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Going 10K above asking is not necessarily the best way to win an offer. Each situation is different and if it's an REO each asset is handled differently depending on who had the asset. Your agent should be able to help you with how to submit a successful bid depending on who the asset is with. For example you would not necessarily submit an offer in the same manner for a property listed with Fannie Mae than you would if it was with PAS or Freddie Mac. These assets are handled very differently and asset managers are looking for different criteria in winning bids. If nothing else your agent should be able to help you better understand what your expectations should be on a given asset depending on who is selling it. If you are relying on financing going to far above list price is not necessarily the best offer. Understand asset managers have already been advised on condition of property and fair market value. If you submit an offer that is not reasonable with an appraisal from your lender if accepted of course the asset manager will value a cash offer over your even it's it's lower. Writing successful offers on REO's is more than just submitting the highest offer. Much more is really needed especially in this current market where inventory in Bakersfield is at it's lowest it's been in over 6 years with current active inventory only at about 2 1/2 month supply. I understand your fustration because If the property is well priced in a desirable neighborhood competition for purchase will be fierce, so you definantly want to start tailoring your offers specific to the needs of the property and take into account who the asset belongs to.
1 vote Thank Flag Link Sat Nov 19, 2011
I have many options to get an offer accepted without pushing the value by 10k over asking price. These days you have to be crafty to win. Let me know if you need my assistance if you haven't funded.

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0 votes Thank Flag Link Thu Oct 25, 2012
Your offer had something that the other offers did not. And the money was not the factor that made them pick the other offers. So with your Realtor and Lender you should evaluate your offer packet and see what you can clean up to make your offer clean as a whistle.
0 votes Thank Flag Link Sat Jul 7, 2012
Thank you so much for all the great advice. The first home was not a distressed property and the second was a short sale. But both were listed below market value so that the offers we made would still be below appraisal. In both cases we had the highest offer with 30 day close. We will keep trying!
0 votes Thank Flag Link Sat Nov 19, 2011
Thanks for the question. It Is quite common now a days.

One way around it, is by being very familiar with the market and the values.

This will allow you to write a Non contingent offer without inspections or loan
Contingency provided you are sure you can get a loan, when the right house comes along.

One of the advantages of an all cash offer is that there is no loan nor in many cases an
Inspection contingency. The buyer pays less for the house by paying all cash, fixes it up
Himself and then rents it out or moves in.

Other option is to pursue Homepath homes, when they come to market, as first preference is given to
Owner buyers.

If one is un comfortable with non contingent offers then, the only approach is like you have been going,
Writing offers, in time one will stick

Good luck.
Perry
0 votes Thank Flag Link Sat Nov 19, 2011
I totally understand your frustration and this is happening right now due to our Inventory so low. Have you ever thought about New Construction ? I have standing Inventory with one for immediate move-in and other Plans that can be ready within 100days or sooner. Please email me or give me a call and I look forward to hearing from you soon!
Arlene Jones
0 votes Thank Flag Link Sat Nov 19, 2011
If you're negotiating on distressed property acquisitions i.e. short sales, foreclosures, etc. welcome to the world of frustration and disappointment. It's not always about the price. In fact you used the word pre-approved which denotes a finance deal. Perhaps the higher offers were cash deals or quick turnaround sales.

Lot's of variables to consider. Distressed properties are not always cracked up to what they used to be. As certain inventory pools shrink in certain areas the demand goes up and you begin to experience multiple offers which can start driving up prices. But terms are and will continue to be the motivating factor in most deals.
0 votes Thank Flag Link Sat Nov 19, 2011
The only thing you can do is to keep looking and keep making offers. I agree with the previous answers that have told you that not all of those deals will close. When I was looking for my own home, we made at least 6 offers on other homes before the one we got AND we first lost this house to a cash buyer. Then the cash buyer backed out a week later and we got the house.
The market is very frustrating for everyone these days!!! Everyone gets that feeling of being "beaten" out of houses... but its up to your agent to keep you on track and stay positive!!!
Good things come from hard work and it's hard work to buy a house!!!

Good luck,
Valerie
0 votes Thank Flag Link Sat Nov 19, 2011
You have already received a lot of good advice I would just add that you might still have a chance with these properties. The sad reality is that many "all cash buyers" really don't have the cash. Some will not close. Make sure your agent keeps tabs of these homes and so you are ready to go if the home falls out of escrow.
0 votes Thank Flag Link Sat Nov 19, 2011
That is tough. the best you can do is be persistant and patient. Cash buyers usualy have the advantage you need to beat them to the punch. Don't wait for a property to have a sign in the window. Make sure you are seeing the home in the first 3 days it goes on the market and get your offer in first. remember, be patient and persistnat.
0 votes Thank Flag Link Sat Nov 19, 2011
You just have to keep trying. It will happen for you but you have to be persistent. Have your agent ask about cash offers so you have realistic expectations. With the sellers permission, they can even tell you what the bids are.

Best Regards,

Eric Soderlund
0 votes Thank Flag Link Sat Nov 19, 2011
Buying foreclosures can be a frustrating venture, especially when you don't have cash. I hope you have found a good agent to work with as that is the most important way to get your ducks in order to prepare for an offer. Your agent should be clear on what your looking for and when you find something, should be calling the listing agent immediately to find out what the competition is like. although selling agents cannot tell you what the actual other offers are, they can give you some general idea. Also, I try and encourage my clients to choose houses with minor defects that have fewer buyers competing, or watch for a short sale. If your pre-approval is for a very low down, you might try and increase your downpayment. Best, Terry Bell, Realtor, Santa Rosa, CA
0 votes Thank Flag Link Fri Nov 18, 2011
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