Home Buying in Bonita>Question Details

Mh, Home Buyer in Bonita, CA

How low is too low for an REO offer?

Asked by Mh, Bonita, CA Sat Jan 24, 2009

I have had my eye on a property for a while now... It is priced well above what I am comfortable offering...However, it has now been on the market for 150 days...On another site I read that banks usually expect to get 30% of what an REO is worth... This seemed ridiculously low... but on an 800K home... how low would be too low to offer? The property is in Bonit, California in a nice neighborhood... But the mortgage crisis has hit this entire city very hard... Any thoughts?

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5
Hi Bonita Buyer,

I'm in a similar situation and am wondering how things turned out for you? What did you offer and did the bank accept...I have found a house I adore, but have champagne taste with the beer budget (well not beer)
; - )

Seems like everything is getting snatched up before I can even make an offer.
0 votes Thank Flag Link Sun Sep 27, 2009
MH,

You need to contact me. I work in Bonita and know the area very well. I will run the comps on the home and put together a package to submit to the REO Listings Agent to submit to the asset manager. If it's been on the market for as long as you say I think $400,000 might not be a low offer. Visit my site and drop me an email.

Dawn Lewis
http://www.dawnsellssandiego.com/
0 votes Thank Flag Link Mon Jan 26, 2009
Banks will tend to sit on the properties and adjust the price slowly before they accept low-ball offers. I live and work in East Chula Vista/Bonita and although this economy has had an impact on the market, people from north San Diego are picking up on how great it is down here for the price and now these homes are moving fast. I'm almost always in a multiple offer situation. However, since the property has been sitting on the market for some time now, I would recommend two things:
1. Offer the price you think it's worth and see what happens. Worse case scenerio, they reject your offer and you can always submit a new one if you choose to.
2. Wait and see if they reduce the price.
I would make an offer on it if I were you. When these properties sit on the market for a while, it seems as though the banks finally adjust the price just right to bring in multiple offers and then you're stuck in a bidding war.

Let me know if I can help!
Cassandra
0 votes Thank Flag Link Sun Jan 25, 2009
Mh,

Our recommendation is to review the same information the bank will be considering when the make the decision about your offer. Their representatives need to be able to justify the amount they accept and do so by considering the comps of recently sole similar homes in the same general area.

A real estate professional can support you in this initiative by providing you with this information as well as their professional opinion. We recommend discounting this informed price but suggest being reasonable with your offer. Banks are not in the business of losing money and will be doing so with this transaction.

There is one thing for certain. Your position will be a much stronger one if you have the right information to back up your offer as opposed to throwing them a general discounted amount.

Good luck
0 votes Thank Flag Link Sun Jan 25, 2009
I think when you said banks usually expect to get 30% of what an REO is worth, you might be thinking when they offered it as an REO (bank owned) property.

The offer should really depend on how the bank owned property is listed, how many people are interested and how long it has been on market. Marin REOs that are priced right (which means 'Low' to start with) often seen multiple offers at slightly higher than listing price. Supply and demand is the key, even in Bank Owned properties.

I would ask your realtor about the trend in your specific area and get a comp to decide if the listed REO price is reasonable. If so, then I will go with that.

Best,
Sylvia Barry
Marin Realtor
0 votes Thank Flag Link Sat Jan 24, 2009
Sylvia Barry,…, Real Estate Pro in Marin, CA
MVP'08
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