Present a cover letter, along with the other documents, highlighting why you are presenting a counter-offer and explain these are material defects in the property.

Most certainly, the bank's listing agent will want that EMD in certified funds by some bank-specified deadline (could be found in the bank's counteroffer or addendum - it will be in the contract somewhere).REO listing agents should be accustomed to low-ball offers - it is the nature of the beast let's just say.

My title company does all the work asside from the counter offer so I'm not feeling bad about the 1.5% at all.

Only use your comps if you really need to counter to a counteroffer they give you.Typically, these lenders internally use some automated valuation model, and they can be all over the place.

Submit a counter offer if the property is still in your range.

I have asked to see any counteroffers or any communication from the bank and our agent insists that none are available from Chase Bank (formerly WAMU).

Originally posted by Phil Mondiello: If the banks counter with something like 197k from 200k than I would just move to the next house...In my experience, banks will generally make a first counter-offer very near full-price (or even AT full-price), but the fact that you got a counter instead of a flat-out rejection is a good sign, and often the second counter is much better.For example (I'm making this up based on my previous experiences), if a property I'm going after is listed at $65K, I might offer $45K.

In Florida, I've offered and been counterofferred on a bank owned REO via email exchange through a realtor.

We got an offer in 24 hours CASH for $90,000 and the next day told the bank we'd meet the $60,000 counter offer.

If it's declined the deposit is returned and everyone goes about their merry way (if the winner of the auction doesn't accept their counter offer).