Offering on a foreclosure - offering low and resubmitting

[Jacob Chapman]

Hey BP!

I am thinking if doing my first Forclosure and wanted to learn from your experiences if possible. I know forclosures can take months and even up to a year or more to go through, so before I get too deep, I wanted to hear from you.

A house is listed for 80k, but has been on market for 3 months. Based on an amortization calc and when it was bought the bank likely has a note of 55k still due.

My thought is to offer 65k, and just resubmit the offer every other week or so it is on the market. What are your thoughts on this - is this unprofessional? Or a waste of time as forclosures often take months no matter what? I would love to hear your thoughts on this

[Christopher Phillips]

@Jacob Chapman

You're confusing foreclosures with shortsales.

Shortsales can take a long time. Shortsales aren't foreclosures. They are owners trying to sell for less than their mortgage is worth. They haven't been foreclosed on yet. If they can't sell it and are in default, the bank will foreclose on them and send it to auction. If the auction fails, the bank takes it back and eventually lists it on the market as a bank owned property.

When it's on the market as a bank owned property (hud, fannie mae and freddie mac as well), it sells like any house on the market. It can take 1 day, can take longer. Depends on how quickly they get offers they are looking for.

If you're in a multi-offer environment, submitting a bunch of low offers and creeping up doesn't do anything. Other higher and better offers (no contingencies, all cash) will beat you every time. If you're in situation where there are really no other offers, then submitting low and waiting them out might work. Right now, most foreclosures are tough to come by because there's a lot of competition from investors with cash.