Image by madmolecule via Flickr
Well, it’s been another interesting week. After much discussion, calls, emails, etc. regarding the REO offer we submitted, we decided to move onto another deal. I’ll try to make quite a long story short.
Our Agent had submitted our offer – the P&S, $1000 earnest money, pre-approval letter, etc. to the listing Agent for the bank. Right after submitting the offer, the listing Agent said he couldn’t submit the offer to the bank with our pre-approval letter. Personally, I could not understand why he would not submit the offer to the bank…they were probably going to counter our offer anyway. Our rehab (hard money) lender provided me another letter, which I submitted to our Agent. She said the listing Agent didn’t like this letter either, since the letter didn’t mention the downpayment amount. I got in touch with the lender and she said that she couldn’t note this amount (or %) in the letter yet, it’d depend on the final accepted offer. Makes sense to me, but the listing Agent wouldn’t have it. We tried to explain that the offer price will likely change by about $30k if the house didn’t pass Title V (septic) inspection, which was likely. All this still didn’t matter…the listing Agent said they wanted a letter from a “direct lender.”
So, in the past week, I talked to a couple other different lenders and got lots of helpful info. Also, when I talked to my original lender, she mentioned that on occasion, some banks don’t accept her letter, because the bank think she’s a broker, which she’s not – she does her own loans. Then the listing Agent suggested we offer to put more money down. That’s when I really started to get annoyed. Why are they asking for all this stuff when they haven’t even submitted our offer to the bank?
After much deliberation, my husband and I decided to pass on this one. If the bank was going to give us this much hassle to submit an offer, what were they going to do afterward? We didn’t see the need to jump through all these hoops when there are so many other houses out there. On to the next one.
Have you ever had such difficulty submitting an offer on an REO? Did you ever have a valid, thorough and very detailed pre-approval letter get rejected?
Happy Investing!
Tags: bank owned houses, flipping houses, invest in real estate, real estate, REO
Steph, you’re doing the right thing. No REO offer should require that much hoop jumping….on to the next one!
Thanks, Shae. You saying that makes me feel better and that we did the right thing. There are plenty of deals out there, so we’re looking at more houses tomorrow!
Enjoy the rest of the weekend,
Steph
I agree Steph that you’re doing the right thing. Sometimes if someone is being a pain up front…well imagine how tough the deal will be. And you figured that out, of course.
I can’t say that I’ve ever had a valid POF letter nixed from someone…but I have of course got cursed out by agents for REO offers
(At least I know I didn’t offer too much right? lol)
Thanks, Carey. Makes me feel better. It’s too bad becuase it was a great house. Oh well, there will be others.
And making lowball offers is part of the game. If the Agents get insulted, too bad. In this market, they should be happy to get offers.
Steph