Hi Amanda,

The REO buying process can be frustrating as it can be difficult to get through the maze of processors and to the final decision maker. They are usually looking for the cleanest offer, and while offering a cash deal might remove contigency objections, it will probably not earn you a lower sales price. What it may do is offer the advantage of closing more quickly than other buyers. REO Companies are trying to unload these properties quickly, but there is a misconception that they are giving them away. Most offers must be accompanied by a qualification letter from the Mortgage Company the prospective buyer is using. If you really want the property, have your agent thouroughly research the current market and the condition of the property.

Interest rates are great right now. If you are buying this property as an investment, and the cash flow works, put down 20% and finance the rest. When you have a renter in place that you are sure will pay the rent, go out and find another deal. This is a great time for those with enough cash for at least a 20% down payment to begin a rental portfolio. Just be wise and surround yourself with professionals who can look at things from all angles. You will need a real estate agent that is experienced in investment properties, a real estate attorney that will give you their undivided attention, a great home inspector and a trusted accountant. Let others (your renters) pay for the propertes you find!

You don't know how fortunate you are to find yourself in a cash position. Just go slow and do your homework.

Molly Bridges
Savannah Quarters Realty

WHen there are several offers on the table most sellers (bank REO's) counter to the buyers with "Highest and Best " meaning bring your Highest and Best offer" i.e. remove any contigencies, closing cost or inspections as a buyer you'd like to remove. I have seen "cash" offers of a lower amount accepted, and I have seen full financed offers accepted over cash offers that were just to low or as you say "discounted for cash". Most sellers are looking to get as much as possable out of their properties these days. When a property has been on the market a while and there are not multiple offers in ,as a buyer you can get a better deal ocasionally with a cash offer, but Not in EVERY purchase.