Is it possible to offer on REO before it hits the MLS?

Question

I'm a first time home buyer in California that found her dream home. It was a short sale with 2 loans. Very long story short, I don't think this is going to happen.  I think it's going to forclose. The 1st is held by GMAC Mortage for about 650K. I made the comment to my agent that if it forescloses  I want to try and get an offer in before it hits the MLS. My agent replied "good luck with that". 
          
          Is there any kind of game plan that will allow me to offer on this property before it hits the MLS?

Jennifer Minge · Answer

Yes you can buy a foreclosure before it hits the MLS by posting your contact information on the property. I purchased a foreclosed quad this way. We knew when it was foreclosed on, waited a month or two till all of the tenants were gone and property was vacant, we posted our business card with handwritten note on back that says we want to buy property. Put on all 4 doors. The bank assigned it to an agent who had yet finished all the necessary paperwork to get it listed. The agent sent a person out to rekey all of the locks and put a lockbox on it in preparation of showing. That person saw our notes, called the agent and relayed the information and the agent called us that night. Once she realized we already owned other quads in the area and were serious buyers we named our purchase price and why we offered that amount. She talked to bank and they bank acccepted it. The agent did convince them that it was a good offer using the reasons we gave her. I think she was motivated because we did not have an agent which meant she got 100% commission. We closed 3 weeks later. It was never listed in the MLS.

G. F. · Answer

Great idea Ted but be prepared to purchase it at full BPO price if you buy it right out the gate.

Steve Babiak · Answer

If it is a great find, it might sell at the foreclosure auction and never get to be an REO.  Don't assume you are the only one who will want it either even if it gets to be an REO.

As far as selling before hitting MLS: yes this can be done; one would have to have a relationship already formed with either the listing agent or the asset manager for the lender.  Since most asset managers will only sell via listing with a realtor, we try to forge the relationship with the listing agents.  On this one, I think your agent is giving you the truthful reply - you would have to be fortunate to get it if it turns out to be a great deal.

Bill Gulley · Answer

Hi Brian, there is nothing wrong with getting to know loan officers, they will know if something in their portfolio will be going to foreclosure, or watch the notices. Banks are required to actively markey the property so that means list it. But if you make an offer, they can sell it brfore a listing unless they have a contractual agreement to list all properties with a broker. As mentioned above, expect to pay the asking price. Bill

Ted Harris · Answer

Once it's been foreclosed, you could leave your contact info at the home stating you want to buy .... finding the potential listing REO agent could prove challenging but eventually they should drop by the house and see your note.

Account Closed · Answer

Keep working on the short sale. You never know, it might suddenly come together.

If you are trying to do a short sale, you already know who has the mortgage. Contact them and ask who they list their REO with. Then you can contact that agent and let them know you are interested.

Also, do the math: what are the mortgages and what is the price you want to pay? If you would pay the full price of the first, you could try maybe purchase the second for a very steep discount and file forclosure yourself.  Then contact the first holder and offer to buy their contract for full price.

Mary Ann Rocco · Answer

Thanks to all. It appears that the short sale may be going through. I almost wish it would foreclose because I think the asking price as an REO would end up being less that what I'm paying on the short sale!  But then again REO's create more buyer interest so that may not be true. Could end up in a bidding war.

It sure seems alot easier when you're buying as an investor instead of a roof over your head...

Kristian Peter · Answer

You can find the REO Broker in your area that works with GMAC (1st lien holder), and possibly get an offer in to the Asset Manager in charge of that property.  If you have the APN - assuming that it goes to foreclosure, we can look up who the asset manager is - we have a great relationship with GMAC RESCAP, and work with several asset managers that handle properties in San Diego.

Kristian

Brian Haskins · Answer

Not unless you know the agent that will be listing it. You can have your agent ask the bank and see, but in most cases it won't happen.

Brian Haskins

Is it possible to offer on REO before it hits the MLS?

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