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The answer is he wants to lock in a price for a home that he is ok with.
Yes dont put anything past the banks...they are hoping that some bidding wars will take place or are pricing the home based on area comps.
If you have intrest in the home I would say make your offer based on your learned information about the property.
Offer what you think it is worth. The worst the bank can say is "no". The nice thing about REO's is there is no emotion in the purchase (on the banks side) it is all numbers.
How could it be in foreclosure if it was just purchased in January? Are you sure that sale in Jan was qualified? Who was it to an individual or a bank? Something sounds fishy there - foreclosures take months and first the owner has to get behind on payment. I don't see how that could have all happened over 5.1 months.
AFA ppsf goes, you should calculate the average using comps for the area and offer slightly below that so you have some room to negotiate with.
30ashopper... sometimes the banks file their purchase price... that is the price the bank paid to get the house.
Don't look at other houses listing prices to determine what you think is fair. Look at sales prices.
In the State of Georgia, the Bank or Lender can foreclose on a property if it's only a month in arrears. From how I understand the question, it seems as though the builder may have lost it's financing and couldn't finish the project. If there are multiple homes in a "new" sub-division that are in foreclosure and especially if the homes have not been occupied, you can be certain that it was a builder forclosure not an individual. If that is indeed the case, I would steer clear of this deal. Unless you plan to stay in this home for a minimum of 10 years, because it would probably take that long to truly see a return on your investment, consider other properties. Again this is if and only if this is a builder foreclosure.
"sometimes the banks file their purchase price"
From my understanding they list the remaining balance on the loan, but those always go down as unqualified.
That 366K is probably what it went back to the bank for. Chances are its worth even less than that. See if you can find prior sales history for it. What did the prior owner buy it for? What was it worth in 2003?
Very nice Broderick........great advice IMHO. Like others said the worst they can say is no, but in in GA things are getting worse by the minute.
I have been in the Mortgage Industry for 16 plus years, so here is my two cents, for what its worth!
I would think the reason the lender is selling some much higher, is that they have a lot of fees, and/or unpaid interest and payments that they are trying to recoup.
You are always welcome to offer anything you wish. I can tell you from what I have seen and heard, you might just get what you want.
I would also make sure that you put on an INSPECTION CONTINGENCY, so anything wrong with the place, you can ask them to fix it, or you can still back out of the deal!
Good Luck!
ST
Also, you can have an independant appraiser do a market comparsion for you to give you an idea of what it might be worth going forward.
Obviously, no one can predict the future, but this guy can give you his advise. Hope that helps!
ST
Hey Broderick,
What do you see happening in Roswell/Alpharetta now and in the near future?
pfft... I can guess what area you are referring to... that area is still doing OK enough to warrant a market asking price, but since its a foreclosure, things are a little different so your offer certainly needs to make sense to the bank.
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I appreciate all your responses. There are approximately 222 foreclousures/preforeclosures in that particular zipcode. How can this area be doing OK with so many foreclosures??
Foreclosures are just part of the story... it is still a desireable part of town, at least going by the open houses I've been to and number of calls I've goten on listings in that area compared to other areas. Lets be clear that asking price is typically a recommendation of the listing agent, which may or may not be overpriced depending on the particular neighborhood. It doesn't matter if there are 222 foreclosures in the zip code if there are 0 in that particular subdivision or very few near by.
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Please I need help.
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Listing sheet for May 9th from realty agent quotes a price of $434,900 for a 5bed 4bath home in Suwanee, GA. The house is in foreclosure. I did a little research and found out home was purchased in Jan 2008 for $366,708. Would this be a bank owned REO, and if it is, why would they mark up the price so much? The listing agent also showed me other homes for sale in the same subdivison and they were priced in the $434,000- $470,000 range...all overpriced IMHO. Would it be unreasonable for me to make an offer price of $366,708 on the foreclosed home I've calculated a price per sq ft of $103.53 for the foreclosed home and I wonder if it's standard practice to use this same price/sq ft in figuring out an offer price for the other homes for sale in the subdivision. Thanks
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