Bank's Incompetency = Buyer's Gain

By
Real Estate Agent with RE/MAX Big Bear

It is no wonder why so many banks are failing these days.  They just do not seem to comprehend what is going on in the current real estate market. Here is a perfect example.

This property just came on the market for sale in the Moonridge area of Big Bear.

Listing price is $399,900, 3 bed, office, family room, & 2.5 baths.  It needs roughly $15,000 to $25,000 in finishing details to complete it.  The property is now bank owned.

Another Bank Screw Up

A little history on this property. I had it for sale from April to August of this year, listed initially at $525,000 but reduced to $475,000 about 30 days after hitting the market.  The property was a short sale as the owner owed $605,000 on the property.

We had a legitimate offer in mid July for $450,000, 20% down and a 30 day escrow.  The bank did not even counter this offer. Their main objection to the offer was that they had an appraisal from January of this year in the upper $600,000's.

I emailed them recent comps to show they were way off base but it was wasted effort on my part.

Now, just a couple months later, and after having to take the property back at a $605,000 price, plus the cost of foreclosing on the previous owner, they put the property back on the market yesterday for $399,900.

I am not trying to sound like I have sour grapes because I missed out on the sale.  I just don't understand how these banks make such financial decisions.  Can someone please explain what I am missing?

This is not an isolated incident.  I have seen it numerous times in the past year.

You hear all the news today about banks working with buyers & sellers but this is a perfect example of what is actually happening.  They just do not get it.  They are going to lose at least $50,000 from what they most likely would have received 3 months ago.

If you are looking to buy a home in Big Bear, this bank's incompetence could be your gain.

 

Syndicated from & originally posted at The Big Bear Skinny.

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Rainmaker
392,080
Kim Sellers
Lake Arrowhead, CA Coldwell Banker - Lake Arrowhead, CA
Lake Arrowhead Realtor - BRE#01412099 - Lake Arrow

Tyler this has been bothering me for a while now.  I am seeing this happening and it is really a shame that the banks are almost playing a game. 

Nov 06, 2008 08:25 AM #1
Rainer
261,679
Greg Steffens
Mountain Country Realty - Lake Arrowhead, CA

You're not the first to post a situation like this....I hear it over and over.  Frustrating, to say the least.  I think you're right, though, the bank's loss can be, potentially, the buyers gain.  Nice post, Tyler....

Nov 19, 2008 02:39 AM #2
Rainer
83,973
Joanne Hanson
Coldwell Banker Colorado Rockies Real Estate - Frisco, CO
Summit County, Colorado Realtor

I am so glad we do not have a lot of foreclosures.  It is bad enough dealing with banks and lenders working with Buyers, much less when they are the Seller!

Nov 25, 2008 02:06 PM #3
Rainer
26,847
Amy Whiffen
RE/MAX Southern Shores - Myrtle Beach, SC
REALTOR - Myrtle Beach Real Estate

Tyler I feel your pain, I have had many similiar experiences...

Dec 22, 2008 07:13 AM #4
Rainmaker
325,921
Esko Kiuru
Bethesda, MD

Tyler,

Similar stories are told here in Las Vegas. Good many banks seemingly refuse to accept the cold reality of declining home values, despite seeing it all around them. Amazing. 

Jan 02, 2009 03:52 AM #5
Rainer
24,571
Jill Stanton-Bricker
RE/MAX Realty Today - South Lake Tahoe, CA
Tahoe, S. Lake, RE/MAX

Similar stories here in Lake Tahoe, CA...imagine that! I submitted an offer on a short sale of 450K on a list price of 525K (550K was "owed") with a 2.5% commission in August 2008...they told me to take a hike. It was just listed REO at 425K with a 4.5% commission Dec 2008...of course, my potential buyers have already moved on & purchased a different property. I also feel for the listing agents who have dedicated time and money into a listing & that they should be considered by the bank to continue listing it after Foreclosure. Some of the REO agents in my area are the main source of declining prices as they price them WELL under fair market value. I understand the banks stategy & that they want to unload the property ASAP, but this is not helping the economy or local markets now or in the long run. It is helping a small handful of buyers that in return bring down the median of the neighborhood. Another example was a home listed at 549K...600K was "owed", we offered 475K 2 months ago to no avail & it just was re-listed REO for 425K...I suggested my buyer offer 400K at least...he decided on 375K...after all it is the buyers $, not mine. Interesting times...oi!

Jan 13, 2009 04:53 AM #6
Rainer
9,514
Joan Wilson
Prudential California Realty - Carlsbad, CA
760-757-3468

I love ank owned properties. They usually are cheap in comparison. Wish I was looking in Big Bear...Like the house.

Jan 13, 2009 08:38 AM #7
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Tyler Wood

Big Bear Real Estate
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