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Anybody with experience in buying a foreclosure?

So, I've been working on getting pre-approval for buying my first home, and we are very interested in a foreclosure property that is, all things considered, a little too-good-to-be-true (low price, right size, right location, etc.) But I found out today that there is another offer already on the table for this property, although the bank has not accepted it yet and the offer is lower than the asking price. So, my question is, if we were to put in an offer (assuming our pre-approval goes through), does anyone know how the banks decide which offer to take? Is it all about the price, or is there a first-come, first-served kind of deal? If we were to offer MORE than the asking price, would they be more inclined to take our offer over the earlier one? ANY advice is much appreciated!!!

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Iskkra

Asked by Iskkra at 4:14 PM on Jan. 25, 2010 in Just for Fun

Level 3 (20 Credits)
Answers (17)
  • it just depend on the bank what offer they want to take
    Anonymous

    Answer by Anonymous at 4:16 PM on Jan. 25, 2010

  • I bought a foreclosure but when I did it, it was first come first serve. With the economy being so bad they may have changed the policies. Are you working with an agent? Our agent only worked on foreclosures and knew all the answers (or where to find them). I'd ask the agent (or get an agent.)
    admckenzie

    Answer by admckenzie at 4:17 PM on Jan. 25, 2010

  • we bought a house that was a short sale. which is similar to a foreclosure .... but not. anyways, our real estate agent told us there was already an offer for the house (but we didnt know for how much)... we wanted it really bad so we didnt go any lower than the asking price, and we got the house. so it wouldnt hurt to offer as close to the asking price as you can in my opinion.
    Anonymous

    Answer by Anonymous at 4:22 PM on Jan. 25, 2010

  • My mistake. It is a short-sale, not a foreclosure. Does that make any difference? We were told that, even though the asking price was $85,000, that the bank WANTED $89,000 for it... We are working with a few agents but they are all kind of giving us the run-around, and its annoying, because we don't want to lose this house! So I'm wondering if the bank would take an offer closer to the price they WANT, rather than the one they posted. The other offer was for 84,000...
    Iskkra

    Answer by Iskkra at 4:42 PM on Jan. 25, 2010

  • Foreclosures can be kind of "up in the air." You might get a good house and you may not. Dont forget that when you are dealing with a bid on the table, you will be able to get an inspector. He/she will give you the heads up on how bad/good of shape the house is in. He/she really are not supposed to sway your, um, buying opinion/decision on the house. Tip** Ask him/her: "On a scale from one to ten, how good of shape do you think its in?" I bet he answers you. GL!
    3gigglemonsters

    Answer by 3gigglemonsters at 4:59 PM on Jan. 25, 2010

  • Oh derrr, I did not really answer your question. Sorry I hope my info helped you out anyways.
    3gigglemonsters

    Answer by 3gigglemonsters at 5:02 PM on Jan. 25, 2010

  • The agents are giving you the runn around because they probably dont want to deal with a short sale. Banks are a pain to work with and they will drag their feet for months before they decide to go ahead with a short sale. They are waiting to see if they get a better offer Be prepared for a short sale to be a HUGE headache, and feeling like you are getting the run around. You will get it. And also be prepared to wait 6 months with no answers, and the possiblility that you dont get the house. I would look into foreclosures. The banks want those gone asap.
    Thant being said, I wish you luck.!
    Anonymous

    Answer by Anonymous at 5:06 PM on Jan. 25, 2010

  • Actually, the asking price is what an agent and the owner decided to ask for the property, offered as a short sale, but it ALL depends on the bank. The bank may not even care that there are offers. The homeowner is trying to ask his bank to agree to your offer. They may agree, they may not even look at the offer. The are more than likely somewhere in the foreclosure process so IF they just defaulted, you may have a long wait
    Anonymous

    Answer by Anonymous at 5:12 PM on Jan. 25, 2010

  • Short sales are rough. They can take MONTHS to hear back. If they are still taking offers, it is in your best interest to make your "highest and best" offer.

    It is ulitmately up to the bank whether or not the offer is accepted, not the sellers. If this is your dream home and you don't NEED to move right away, sometimes they are worth it. We waited over 4 months on one short sale, before we decided that we needed to look elsewhere. Make sure that your agent puts in that your offer is only good for "x" ammount of days, so your money isn't tied up.
    twin_mommy

    Answer by twin_mommy at 5:19 PM on Jan. 25, 2010

  • If you really want the house, and are willing to pay 89k for it, I would make an 89k offer with as much down as you can afford, preferable at least 10 percent. This makes you a lower risk to the bank.
    twin_mommy

    Answer by twin_mommy at 5:20 PM on Jan. 25, 2010

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