| Are you relocating to Dallas Texas and you want to | | | | - Have them run a search using that listing agent's |
| find a great value on a Dallas REO Home? A REO | | | | name to find the last three to six months of that |
| home is a home that was foreclosed on by the bank | | | | agent's listings. |
| and now the bank owns the home, REO = Real | | | | - Have them pull the history of those listings to |
| Estate Owned. Lots of savvy home buyers want to | | | | determine the list-price to sales-price ratio. If many of |
| hit the "jackpot" and find that Dallas REO home many | | | | those listings are selling for, 5% over list price, then you |
| of which are often under priced. When banks price | | | | may need to offer 6% over list price, and vice versa. |
| these REO homes under the prices of other homes in | | | | 4) Ask About Number of Offers on the REO |
| the community it often results on multiple offers on that | | | | Home |
| home. This means you could be up against some | | | | If there are no offers on the REO home, you can |
| strong competition for that home. | | | | offer less than listed price and still get your offer |
| It's not that unusual for some of these REO homes to | | | | accepted. However, if there are more than two offers, |
| receive 5 or 10 offers. Sometimes the bank will | | | | you will most likely need to offer above the asking |
| disregard all but two offers and then request that the | | | | price. If there are 10 offers, keep in mind that some |
| selected buyers resubmit their Highest, Best and Final | | | | of those offers might be all cash. Banks like all cash |
| offer. Sometimes the bank will simply accept the best | | | | offers. If you are obtaining financing, then you may |
| offer at inception. If you want to know how you | | | | need to increase the price on your offer to be |
| can make your offer rise above all the rest and | | | | considered. |
| become the winning offer, here are a few tips to help | | | | 5) Submit Your Preapproval Letter |
| you do so: | | | | It goes without saying that you do not want a |
| 1) Property History – Get it | | | | prequalification letter. You want a preapproval. Get |
| Ask your Dallas Realtor to find out how much the | | | | preapproved from your lender in advance. |
| bank's purchase price on the foreclosure. Compare | | | | Furthermore, get preapproved by the lender who |
| that price to the price the bank is asking. | | | | owns the property. Do not expect to use this lender |
| Look at the amount of loans that were once secured | | | | for your loan, but submit the preapproval letter from |
| to the property. Somewhere between the original | | | | this lender, along with the letter from your own lender. |
| mortgage balance(s) and the foreclosure sale price is | | | | Banks don't trust other lender preapprovals but they |
| the amount the bank will accept, if the home is priced | | | | will trust their own. |
| under the comparable homes. | | | | 6) Don't Ask for the Bank to make Repairs / |
| 2) Determine Comparable Sales | | | | Inspections |
| In most cases, the listing price has very little bearing on | | | | Occasionally, banks will pay for repairs, but generally |
| the value of the home. The market value of the home | | | | they will not agree to do so. If there are problems |
| carries the most weight. If you are up against other | | | | found during your home inspection, renegotiate your |
| competing offers, other buyers may offer more than | | | | offer. |
| list price. | | | | 7) Shorten the Inspection Period |
| - Take a look at the last three months of comparable | | | | If other buyers ask for 15 days, for example, to |
| sales (CMA) for that neighborhood to determine how | | | | conduct inspections, and you ask for 7, you will be |
| much this REO home is worth. Try to use only those | | | | deemed the more serious buyer. |
| homes that most closely match the REO home | | | | 8) Offer to Split Cost |
| regarding square footage, number of bedrooms, baths, | | | | Some REO banks will not pay transfer and other fees. |
| condition and amenities. | | | | If the buyer offers to split those fees with the bank |
| - Look at the current pending sales. Ask your Realtor | | | | then the bank will be more likely to accepting the |
| to contact the other listing agents of those pending | | | | offer. Many banks negotiate discount fees for title |
| home sales to try to find out the accepted contract | | | | insurance. If the bank will pay for the owner's policy, |
| price. Some will share that information and others will | | | | the title policy may cost a little more. But it's still a good |
| not. | | | | idea to let the bank choose title if you want your offer |
| - Look at the active listings as well. Those are most | | | | accepted. |
| likely the listings other buyers will use to formulate a | | | | Consider the Appraisal Consequences |
| price because they are the only homes those buyers | | | | If you offer over list price, keep in mind that the |
| will actually tour. | | | | appraisal will need to confirm the agreed upon sale |
| 3) Analyze Listing Agent's REO Sold Comparables | | | | price. If you find yourself with a low appraisal, you |
| Most REO agents work for only one or two banks. | | | | have options, so don't stress out. Remember, the bank |
| Some of these listing agents are exclusive listing | | | | will most likely run into this problem with the next buyer |
| agents for REOs, and they do not list any other type | | | | who obtains financing. If your REO home purchase |
| of homes. Since these REO agents deal in volume, | | | | is a result of a Dallas Relocation make sure you use a |
| they typically apply the same pricing principles on all | | | | professional Dallas Realtor to represent your interest in |
| their REO listings. | | | | the transaction. Dallas REO's and Dallas |
| - Ask your Realtor to look up the listing for theses | | | | Foreclosures, the terms represent the same thing |
| REO agents in the MLS. | | | | when it come to buying DFW real estate. |