How Possible Is It For A Buyer Of A REO Or Short Sale Home To Get A Seller Concession

Dated: 06/27/2016

Views: 293

How possible is it for a buyer of a REO or short sale home to get a seller concession?

Answer

segunlulu4 - Great question... and I'm dealing with a buyer client who's had the same question. My standard answer is, "The answer is always no if you never ask."


Most bank-owned sales do not offer concessions. If something came up at inspection that is a legitimate issue, the bank *may* be willing to address... yet I wouldn't bet on it. The time of large concessions from the banks has come and gone as most of the distressed inventory has been cleared from their books. Anything beyond a major item (broken pipes once they de-winterize) are likely not going to be addressed in any form.  


As a matter of fact, most Purchase & Sale contracts that come back from the bank specifically state that any requested repairs will be added to the purchase price


As I tell my clients interested in purchasing a bank-owned property, the negotiation and process will not be fun. You will be on the bank's timeline and will have to play by the bank's rules. There really is very little, if any, negotiating. I hear statements from buyers like, "I'm sure they just want to get it off their books"... and that was last true about 4 years ago. At this point, the banks want as close to market rate as possible. You either pay their number or they likely won't even counter offer. 


Most are typically on a set schedule for changing price... generally around 3 weeks... at which point they'll adjust the price and you either offer their number or they'll wait until they get their number. What's also frustrating for buyers is how long it takes the bank to respond... and you have to realize that the bank will continue taking offers even if they've agreed to your offer. Nothing is set in stone until the P&S is signed and you provide a check. Until that point, if they get what they feel is a better offer, nothing is set in stone. REO is not for the weak hearted.


Good Luck!

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