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Multiple Bids and Back Up Offers
It is very likely that an REO property will receive multiple offers. Buyers have more information readily available pertaining to the real estate market, making more people likely to present and offer. Also, REO and Foreclosed inventory is highly sought after, especially when buyers are aware of the greater potential for value.
Therefore, all offers should be as aggressive as possible. Submitting unreasonable offers trying to get a property for “bottom dollar” is a waste of time for everyone involved. Since the market is so competitive, the first offer presented should be one where the buyer feels they have made their best effort since they may not have a second opportunity to increase their initial bid.
Banks are only concerned with the numbers and terms they are presented with. If someone presents a better offer it will most likely be accepted. Going back and forth with individual counter offers means more time before the property can be sold. Generally the bank will give all interested parties the opportunity to present their highest and best offers by a certain time. After the deadline has passed the bank will officially accept the highest and best offer they have received provided it falls within an acceptable range determined by the set list price and recent sales of similar properties.
Banks do not traditionally entertain back-up offers that come in after an acceptance is given since they do not want to be put in a position where there could be a conflict with the original accepted offer. Once there is an accepted offer new offers are generally held in the file in case the accepted offer falls through. In the event the first accepted offer does not proceed to contract, the bank traditionally returns to all the offers on file, and looks to proceed with the next highest offer that is still viable. This process may vary slightly from bank to bank.
Island Advantage Realty
Island Advantage Realty, LLC has established itself as an innovator and leader in the REO market throughout Metropolitan New York and Long Island. With 20 years of experience handling foreclosed and residential properties, you can rely on our knowledgeable team of agents to assist you with all of your Real Estate needs. Trust the experts. Trust Island Advantage.
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