How long has the property been in the market. .(early on, banks aren't willing to budge)? , The condition of the property( the worst it is the more the discount) and finally the present value of the home( if a home just sold for 50K more next door. . they will not accept an offer losing that much money) Get a good tough agent and GO FOR IT!
There is no magic formula to determine the amount acceptable for a bank owned property. Like you, they keep an eye on the pulse of the market in which their property is located and use this information to as a guide.
The "Eckler Team"
Comments already made by my colleagues are good...it all depends on the bank. However, here's something that you may also find useful...it is a notice to our office recently received from Bank of America about their policies regarding "short sales" in our area.
A short-sale is not exactly the same as a REO purchase from a bank of a bank-owned property, but instructive. A short sale is a sale that takes place before the bank has actually 'foreclosed'; the owner is selling, but is behind on payments to the bank, so the bank and/or mortgage holder(s) get involved in the sale and they have a lot to say. (Generally because the sale will probably not cover the principal owed to the banker(s). So they are a significant party in deciding whether they will accept the sale, and consequent 'hit').
We just received communication from Bank of America outlining their new Short Sale Policies which take effect immediately, including commission adjustments on some files. The communication came from the Risk Operations Manger of their Loss Mitigation department, here are the specifics:
1. Short Sale will be declined if the contract is below 90% of Bank of America's value. They did not specify how the value is established but generally speaking it will be either a BPO or appraisal(s).
2. If Bank of America is expected to take less than 50% of the outstanding balance, the Broker's total commission cannot exceed 4%.
3. Loss Mitigation associates now have the authority to approve short sales all the way down to 70% of the outstanding balance.
4. Officers and Team leaders now have the authority to approve short sales all the way down to 50% of the outstanding balance.
5. Anything lower than 50% of the balance must have Unit Leader approval.
Hope this adds a bit more for you. Cheers--RICHARD--