I would have to agree with Lynn. Many of the banks out there do start their home pricing a bit lower to generate interest and get the home sold as they do not want it to sit on the market too long. They would like to generate more money quicker and they do this by placing the home on the market for a bit under value. This in turn will spur more activity which will typically generate more offers. When buyers know there are other offers on a bank owned property and they want to buy it, they will offer a bit more. The banks already have an appraisal, so they know what the values are and would like to get that and then some if they can.
Offers can vary greatly and how your offer is written can affect which one the bank takes as well. The banks do not want to see a lot of things that a buyer wants such as closing costs, or things out of the ordinary. A clean well written offer and a great deposit, pre-approval letter, FICO scores all should help. The banks typically won't accept offers right away. They compile them for several days to see who has the best offer.
So, what I would suggest is always have your agent write your highest and best offer. If you give the banks what they want, typically you will get the house unless you are low balling, even slightly, if someone writes an offer for full price, then of course, the bank will take their offer over a lower one.
Speak with your agent that is writing offers for you and express what you want to do. If I liked a home and wanted it, I would write an offer for full price with no closing costs and then it would be appealing to the banks. Have your agent keep in touch with the listing agent if other offers come in and see if you are still in the running. If not, submit a new offer for more if you feel you want to pay that for that particular home. If not, walk away and find a new home.
I recently represented a very nice couple on a bank owned property and told them if they really wanted it to make a full priced offer with zero in closing costs and they got the home. Yes, it needed work, but we knew that it was a good value at the price listed and they still need to put over 100,000 into the house as the master bathroom was totally ripped out with only a toilet left! The kitchen needed to be gutted and new flooring, new roof etc needed. But, they loved the home and the design of the inside. So, they knew eventually, they would be able to have it worth more one day. They wanted to low ball it as well, but were glad they listened to me.
I think the most important thing to do is to have your agent keep in touch with the listing agent to see what is going on. It is important to be able to help you decide what to do. I am sorry things have worked out like this for you, but it seems to be the way things are going in this market with interest rates being so low along with home prices. I have had similar occurances happen as well. When things don't work out, it was not meant to be and there is something better in store for you.
Joan Patterson, B.A., A.S.P., G.R.I., Realtor
Keller Williams Realty
8250 White Oak Avenue, Ste 102
Rancho Cucamonga, CA 91730