Yes all foreclosures, pre foreclosures, short sales have drama. I hope you had a great 4th now off to the real estate races again.

Lynn,

I understand that this is traumatic experience for the losing party, but wiht agents srewing Lenders, they become a double losing party. First they did not get the money from the borrower, then they were screwed by sloppy real estate agents.

I am curious what would happen if I sit with the Seller and tell him, that the least expensive unit like his, was sold for $80K, next for $125K. Now, why don't we put your unit on the market for $40,500 and try to have the guys go crazy and start bidding against each other?

What do you think the Seller would say? I am afraid that would be a drama for me right there.

Happy 4 th of July!

Yes Jon Lenders do care of course their appraisal will have to come in at sale price or above for the lender to make good on the loan.

Stephen - I am not talking about the buyer, I am talking about the Seller. When REO property goes to the agent, the agent sometimes comes with a crazy price. That was the topic of discussion, and not the Lender requiring appraisal for the Buyer.

Thanks for visiting.

Truthfully Jon I don't think the lender cares. the lender doesn't want to pay the assessment or the taxes and just wants out as fast as possible.

Simon - I understand, you might be right that they often do not care, or do not care enough to be more vigilant, however, the question whether agent should offer them the same level of professionalism, as when working with any other Seller  still remains.

It may most probably be that they do not know that they are wasily screwed up by agents.

Folks,

This is a strategy for the banks.  It is intentional. Yes, the very banks that caused this giant mess are back at it again.  They are pricing stuff well below BPO's with the FULL INTENTION of generating a bidding war.

I have gone through this now 4 times ...in RIVERSIDE COUNTY no less, one of the worse markets with significant inventory! 

Countrywide was the bank that owned the property I bid on yesterday.  I bid full price.  I won't bid over the asking price. 

Tactics, Tactics, Tactics.  But the bank wins.

So what do I do; do I search for homes $50k less than my target price?  Well most realtors want me to go up...not down in my search???? 

What a terrible frustrating hassle.  For those in doubt, I am approved by 4 lenders, I am seeking a home already $150k less than my approval.  I have been searching for 7 months!  And yes, lost out on better interest rates as a result.  Buyers market??? Where?

fedupbuyer -  I really do not know what is the banks' strategy, but bidding war does not bring more money. The correct pricing is often hire by a very significant number.

It is possible that the client, bank or owner, wants the price low for a quick sale.  Banks have been known to wait for many offers to come in and then tell everyone to resubmit their "best" offer.

Robert -  Yes, I know. However, what bothers me is that the prices are coming so low, that it is crazy. My theory is that agents know that the bank will not sue them later for miscalculating hte price and being off by a huge margin. They sell and leave. The banks will not be analyzing later what other properties similar to this one were selling for.

Often the agents are actually out of the area, so they come with something to make their life easy. Go low, and you will sell.

It is very tough to know the correct pricing, Jon!  I have watched dozens of buyers bid themselves into homes only to see the surrounding home values plummet another 15 to 20 percent in less than a quarter.

According to RealtyTrac.com there is significant pent up inventory in Riverside county that banks have not released, auciton, etc.

The big problem is that compents include the houses taken back by the bank in most cases.  This skews the per sf price in a declining neighborhood.

So do I wait, or do I play??? Tough call.

Fedupbuyer - Strangely, this would not be a question for me. I do not care about the market that much, because the investor can find properties, which I call "Deals" and they are so beyond the market, that even the market falling another 15%, it would not get to that level.

THer eare some terrific REOs, and the bidding just shows that the price is so darn low. I will put an eample of that on AR about the deal in the Plaza Resort & Spa here in Daytona.