Need Feedback: Making Offers on REO's - Posted by Barry (FL)

Posted by JeffGinFL on January 19, 2002 at 22:08:53:

Barry -

I am in Volusia as well. I too have an agent who loops me in on the REOs that hit the marketplace. My experience is that the banks don’t generally look at the below ARV offers. They don’t seem to mind waiting for the repairs to be completed. If they want to unload a property quickly, they will list below ARV and it goes - fast. The RE agencies that I have seen in the area that work with the banks on the REOs start work on the properties within a week after getting them. There are deals to be found via this method, but in my opinion they are few.

I’ve tried to make offers of 70% ARV less fixup, to no avail. Haven’t tinkered too much with the formula (upping to 80% of ARV for example) because there just isn’t enough money in them.

Just my take on our market.

Need Feedback: Making Offers on REO’s - Posted by Barry (FL)

Posted by Barry (FL) on January 19, 2002 at 20:54:25:

Found a broker online that handles alot of REO props in my area Have a list of 12, a decent mix of desirable and not so desirable areas, not war zones though. Just need some expert advice. I’ve done comps on the props, most seem to be listed approx FMV or a little below. What I plan on doing is going around to check them and comps., establish fix up costs, determine what was owed at repo. What would be the best way to structure offer?

  • offer .50 on the dollar less fix ups?
  • take FMV x .70 - repairs?
  • offer repoed Loan value if enough equity?

Open to other suggestions.

Any and all help appreciated in advance,