I am so glad I found this forum. I am new to investing in real estate and found out about REOs from a neighbor who is paid by banks to get them into selling condition if need be.

I have been searching for REOs in my local area (Austin, TX) and have found some ""good deals"" comparing listing price to other houses selling in the area with same square footage and general characteristics. My biggest question is how flexible are banks on taking lower than list offers. Is offering 10-15% lower that list price a good idea, or will they automatically reject it? If the 10-15% less meets the total they have in the property wouldn't they accept that?

I would be comming in with cash and be doing small upgrades on nicer homes to cell for a 10-30K profit after commissions and all costs. I'm not looking to blow up my bank account. Or do this for a living.

Thanks in advance to anyone who can offer any guidance

find new homes and condos

If you don't have a realtor to ask for advice (which you really should if you're planning on flipping the property), then start making offers on properties and see what kind of responses you get back from the banks. The percentage you try to discount your offer should be directly tied to the condition of the home and the length of time the property has been on the market.

If a home has been listed for 100+ days, I'd discount it 50% and see what they say. Also, you can make multiple offers on different properties at one time. Only accept the ones you want. This saves a ton of time waiting for answers. The quickest one to respond with the terms you like could be your next investment property.

In some areas, you make an offer, they reject you, you make another one a little bit higher the next day, they reject you, and this goes on until you or someone else makes an offer they'll accept. This can be a slow process but ensures you're not overpaying.

Other areas the banks are actually counter offering now, which makes it easier to gauge their price point.

Keep us posted on your success!

Sharon
Sharon’s Real Estate Investing Support