I agree with Linsey. An offer of a set amount below asking price on an REO will likely get no response what-so-ever from the lender. Have your agent speak with the Listing Agent. Although he/she will not tell you what other offers are, your agent will get a good idea of where you need to be in your offer. Most importantly will be Comps. Banks are not giving properties away. Yes, they have to lighten their portfolio of REO properties BUT, they have to answer to shareholders as well. They will not let a property go @ $200,000 if the market says it should be $285,000 ! If I were a shareholder in that bank, I'd want the Chief Credit Officer fired for giving my money away.
Most importantly be reasonable. Good clean offer, strong earnest money deposit, few contingencies if any and great financials / pre-approval / proof of funds to close and you'll get the propety you want !
Best of luck,
Cheers to you,
Southern California & Houston, TX
2008 Chair, Pacific West AOR MLS Committe
2008 Member SoCal MLS Board of Directors
2008 Member SoCal MLS Steering Committee
2009 Member-elect, Pacific West AOR Board of Directors
2009 Member-elect SoCal MLS Board of Directors