Home Buying in San Diego>Question Details

Melissa, Home Buyer in San Diego, CA

We have put in an offer on a home in Bonita, and it is a forclosure. We were told to submit our offer with

Asked by Melissa, San Diego, CA Tue Aug 19, 2008

our pre APPROVAL, and the pre QUAL from the seller bank. I had told the seller bank that I did not want to do a pre approval with them, that I already had a pre approval through my lender. The seller bank offered to do a pre qual, as long as I gave them our credit scores. This all happened last night. We took a second look at the property online, and the status had changed to PENDING. I spoke to my agent this morning, and she said that there was an offer that the bank liked, but it was not ours. But the seller did not know if the other buyer had a lender, so I would have to wait 15 days to find out. We just went throuh this last week with another home!!!! These sellers (banks) keep calling me and my agent saying put your offer in but the next day........sorry we liked another offer??? What is worse I had this big bank calling me ALL DAY yesterday, even after 5 pm!!!! I felt like my time was wasted. This is our first time trying to find a home, and it is stressful. HELP!!!!!

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Melissa,
With lots of bank owned properties you are in multiple offer situations and your experience is common. I have a short video that will give some REO buyer tips. You probably will have to get a pre approval with the lender selling the home, however, they sometimes will accept the paperwork from another reputable lender. You did not mention that you had an agent, and I concur with Scott that you need a good one. Let me know if you need a referral to some.
See the Bank Owned buying video and other useful ones at...
http://www.youtube.com/profile_videos?user=3fredeckert3&p=r
1 vote Thank Flag Link Tue Aug 19, 2008
Hi Melissa,

I work for Ashlon Realty and currently we list well over 100 bank owned foreclosures here in the southbay and Bonita is basically my back yard. Whenever you put in an offer and in the listing it requests for you to get prequalled through their bank..I highly recommend you do it. Also, your agent must develop a relationship with the listing company buy directly talking to them and finding out as much as he or she can about the listing. He needs to ask questions like..
1. are there any offers on the property
2. if so where are they at
3. What price would my client need to be at to possibly get the home
4. What type of financing do you think the bank that owns the property would like to entertain
5. what type of financing do the other buyers have
6. are the other buyers going FHA or Conventional..if conventional how much are they putting down
So your agent really need to ask many types of questions and really needs to be work in the REO business to fully understand the how to structure an offer..then your agent has to sit down with you and develop the best offer that you can put to obtain the property you want. Good Luck! Vincent Villafranca REALTOR
619 972 8798.
1 vote Thank Flag Link Mon Aug 25, 2008
Like Fred said, there are a lot of multiple offer situations with bank-owned homes. When there are multiple offers, the bank can pick and choose for the very best offer. They generally will go with the borrower who has the combination of the highest offer price, largest down payment, is not asking for a credit for closing costs and least contingencies in their offer.

A strategy can be to make offers on higher priced bank owned homes that may have been on the market longer and that are getting less offers and less competition, and offer below their asking price. Or also to make offers on short sales and the few private seller properties that are out there. Short sales obviously can take months if the bank has not agree to a short pay amount.

Another option is to go after a fixer-upper REO, they may have less competiton. I offer a special renovation loan for owner-occupants where the lender includes the cost to fix up the property in the loan. You don't have to make payments until you move in after the fix up.

It's interesting and not talked about in the media much about the multiple offer situations. People who are not in the market think that it's this increadible buyers market where you can make lowball offers and banks are begging people to take their properties, this is not true in San Diego. There is tremendous competion right now in San Diego for well price homes.

Rob
Sr. Loan Officer
rob@affinity-financial.com
1 vote Thank Flag Link Tue Aug 19, 2008
Unfortanately this happens all the time with bank owned homes, it doesnt make it right but it does. You should know that offers are submitted as they come in, when you put yours in they may be looking at 0, one or five. they are not just looking at price but terms. the 2 keys are to ask before hand do you have any pending offers and the 2nd being make sure your offer is complete the first time. some banks do make you get prequailified through their bank even if you have a mortgage company, it does not hurt your credit score for them to pull it as they consider all pulls as just 1 during this purchase time. next make your best offer, make the largest depsoit you can and do it with a bank check, dont put in ANY contingincies, make it clean, dont ask them to do anything, include your preapproval letter, do your insoection before so you can reflect it in your offer, set a closing date no longer than 30 days from acceptance, ask them to answer within 24 to 48 hours of submitting your offer. Do you have an agent, if not you should have someone looking out for your and if you do make sure they ask these questions before you put in an offer. You also should know this does not happen with all banks or listing agents, a goo dlisting agent will inform you up front of what is going on and if you ask, has to tell you if there are any offers ebfore you put yours in so you can adjust/.Good luck with your purchase.
Web Reference: http://www.ScottSellsNH.com
1 vote Thank Flag Link Tue Aug 19, 2008
Melissa, I'm sorry. Offers on Foreclosures have to be subbmitted just the way the REO agent wants them. Sounds like your agent isn't following the instructions. You need to have your foreclosure package ready to go and have an aggressive buyers agent in your corner. Good Luck - it shouldn't be this hard!
0 votes Thank Flag Link Sat Sep 6, 2008
Dear Melissa,
The pain you describe with your offer process is going on all over San Diego County. What I have found is a disappointing experience if you are a good or even great buyer and getting a proper or dignified response after placing an offer on a short sale or bank owned property.

What I advise my own clients going through this very thing RIGHT NOW is that we make offers on everything and anything we like until someone wants to do business with us. Listing agents may not always divulge the full story to your agent as to what's happening with a property. Banks are losing so much money on these homes that they will and do take one offer over the with no warning.

You need a pre-approval letter, not a pre-qualification letter. Those pre-quals are worthless.

If the bank that owns the property you like wants you to get a preapproval from the, PLEASE agree that instantly if you really want the house. Each wasted hour is a chance you will get pushed around or put on the back burner.

Try to consider bank owned properties over short sales whenever possible. At that point, the asset is already owned by the bank and you are dealing with one person at the bank and one listing agent. The bank wants the asset sold now, so you have a better chance of being heard if you stick with already foreclosed homes.

Can I help you further?

I write a lot of contracts and understand language. Make sure your agent is protecting you from all kinds of tricks banks can pull AFTER acceptance.

Many thanks and good luck. Don't give up. 2008 is your year to buy.
0 votes Thank Flag Link Thu Aug 28, 2008
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