All Forum Posts by: Paul B.

Now THAT is something we can unequivocally agree on.

Great point, and I thank you for that additional feedback.

Well, there is such a thing because I have one...at the top it says, "Shadow Inventory List for Week of December 22." So (and I mean this to be more funny than serious), there IS such a thing!

And that's exactly what it is, a list of houses that are in REO (that is, post-foreclosure) but that do not appear in MLS yet.

I suppose if you know what the BPO is, and if the lender's only concern is meeting or beating that number (regardless of whether waiting a couple weeks would net a still higher price), then you could have a leg up.

Just seems to me that any lender/REO owner would go through the whole process to field the maximum number of offers, even if the first, quick offer meets or exceeds the BPO.

Just curious if anyone's found it worthwhile to receive these "shadow inventory lists" of REO.

While I suppose any advance notice pre-MLS is helpful, isn't the listing agent duty-bound to seek out the highest price, and isn't the buyer likely to wait until the property has hit MLS and been marketed before considering (let alone accepting) any offers?

I appreciate your feedback.

If I recall correctly, if there is no debt, there is no lien. If you're talking about securing previously unsecured debt with collateral, that's different. But to create a fictitious debt, how could this be anything BUT unethical?

I'm seeing some attractively priced REO deals, and I'm thinking about dipping my toe in the water. But that sort of leads me to my question: Are these attractive prices set so low that they bring in a large number of buyers who will bid the property up? Or is that listing price the high-mark, meaning that an offer of 20-30% less has a chance to be accepted? I guess it depends on the property and the listing agent's strategy...

For example, I saw a house that was listed at $99,000. I knew this was too good to be true, and sure enough they had multiple offers, and the final price was north of $140,000, which was way too much for an investor to pay. Is this strategy the norm these days?

I have my eye on a quad that is listed at $139,000, but it's a marginal deal at that price. I'd feel better paying $100,000 -- $120,000 tops. So, what's the strategy here?

To put your second-best deal on the table at the onset, then when the "highest and best offers" call comes, put your true absolute highest price on the table? Or do you just put your best price on the table at the onset and stick to it? Seems like that might be a recipe for paying more than you need to.

(This is why I HATE buying listed property!)

Summary version of my question: Does REO property tend to sell for less than or more than its list price? (Gosh, that was shorter, wasn't it?)

FYI, "BB" stands for "baby bullet."

I know this will fall on deaf ears, but I detest bandit signs. I won't use them in my business, even in the places where they might be legal. They simply make a road or corner look like crap.

In areas where they are illegal, I will either take them down every chance I get or I will spray paint over the phone number.

I know, I know, I know...they make you money. Sorry, but I don't want to run a business where I have to get a separate phone number to hide behind.

My two cents, and yes, I know that most people couldn't care less.

With your uncle, I think you should ask him what he wants and go from there. If it were left up to me, though, I'd offer him a reasonable fixed, preferred return (8-10%?), then a kicker from any profits. The reality is that he's taking an equity-like risk, and he should be getting an equity-like return. Plus, you want him to feel that he made some money so he'll stake your next deal.

Let me ask you...what does your "partner" really bring to the table?

It's been a while since I used these letters. You're right that postcards are cheaper, but I have never tested postcards against letters in the pre-foreclosure market. I am not sure why that is!

I know that these people are getting a TON of mail, most of it bad. So, I try to make my letters stand out. I fold the letter in half only once and use a small catalog envelope that is pink or green or otherwise not very "official" looking.

Also, I think one of the reasons I don't use postcards is that while this information is public knowledge, I would not want to send a postcard to a house with kids living there, and the postcard says, "You're going to lose your house." In fact, I seem to recall doing postcards years ago and got a couple very upset phone calls as a result.

You know what works great at getting your envelope opened, although it's expensive? Use three-part check stock to write your letter. Use the two blank sections to write your note, and then actually fill out the check payable to the recipient (not drawn on any bank, of course -- all that stuff is blank). Use a window envelope so that it looks like an actual check is inside and watch how fast that sucker gets opened!

Here in Georgia, things move pretty fast. You find out about the sales in the legal notices with only a month to go, so you don't have a lot of time. Georgia is one of the more lender-friendly states -- at least that's how it used to be.

If you live in the Washington, D.C. region, you might want to get plugged into the REIA there. John Peterson (who runs it) is a very honest, experienced investor and mentor. The Web site is:
http://www.washingtonreianetwork.com