A little bummed tonight :( Deal may fall through

[Kalyn Ringwold]

So I'm a little bummed out tonight. I've been looking for a home to rehab and I found the perfect house for my first flip. LP is 39,900 (foreclosure) AVR= between 88k-100k. Only has cosmetic damage and i estimated about 10-15k in repair. I was so excited to embark on this new project, and I place a bid at 20k (hoping to end at 25k) turns out there are 4 other bids on the property! And so I raise my bid to 30k (which is my highest) and now im doubting that I will get it. :( Depressing. lol. I know theres always more deals, but this one was looking to be a perfect one to start off with.

How many deals have you had fall through? Do you think I should have offered the full LP?

[Joel Owens]

Kalyn everyone wants cosmetic properties.

You will find regular home buyers do not have to resell and will accept way less of an equity position and pay a higher price to get a home cheap with a low monthly payment.

Their goals are totally different than a rehabber.This is why a bunch of success is taking on properties where a home buyer is not a competitor but it drives down the price with the property not being loan ready.

If your offer of cash is just slightly lower than a finance home buyer the asset manager might still choose you.If there is a wide difference the asset manager might take a shot with the finance home buyer to net more.It depends on a bunch of factors which is being at the right place at the right time.You also have to understand local,regional,and national banks make decisions in different ways.

Kayln are you offering to let the listing broker keep all the commission are are you getting greedy and asking for the co-op??

Whether you say ethics or any other BS in the real world these REO kings and queens have a list of buyers ready to purchase with cash where the REO broker can double end a deal.If the offer is close to what the asset manager wants then the bank doesn't care about double ending.

How you level the playing field is to tell the listing agent they can keep all the commission so they will push your offer with all things being equal.

It is a classic mistake I see brokers and agents make time and again.The REO broker is only getting a tiny fee on their side and having to cover a bunch of costs listing the REO so getting the other side is huge for them.

If you are flipping you will save the commission on the sell side as an agent and you can put 4% co-op to get buyers agents in droves and still save 2%.

The price has to be competitive and the rehab quality for the area as always.You can't just offer a higher co-op and then list high to compensate for it.That is another classic seller mistake.

good luck