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lyoungblood's link provides a very hilarious yet effective way to play the realtor's game. When I talked to the seller's agent, I was amazed how calm he was to admit what he is capable of. I was prepared psychologically and mentally how much this property worth in my own calculator. It is very similar to the wonderful posts above. I'm afraid if I showed negative emotion about the comments or rebutted too strongly, I might miss many good acts that were coming. I believe if we share our experience dealing with realtor, we can beat them in their own game.
I do wish if we can easily find out who the seller or asset manager is easily. That way we may be able to submit offer directly to the banks.
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Just visit a property in Inland Empire. I contacted the listing agent directly for a tour of a house I'm interested in. Here is my experience and my opinion-meter about this agent.
This agent is quite professional. Shows me around, points out the nice features. This is a short sale property. The agent seems very knowledgeable.
According to him, the owner got this house at the peak and got laid off. He helped the original owner bought this house back then and setting up the short sale now and the proposal will likely be approved by the lender. The short sale price is 33% off the peak price.
He immediately points out that he has total control of what offer lands on lender's desk while not against the rule. (I like him being honest on this aspect, up opinion-meter). This property has attracted 20 offers but mostly FHA offer with 3.5% DP. He also brings up the current market condition where a house usually get multiple offers and sometimes with over listing price if priced right(opinion-meter down a bit, feel likes he tries to prevent a low ball offer). He goes on saying banks are holding back many REO to create a scarcity on the market(honest, opinion-meter up). What's more, the economic is getting better(really, opinion-meter down, what an obvious big mistake) and the market will be more competitive in coming months and price may go up. I tell him the competition in the market sometimes are caused by realtor themselves buying the house at a cutthroat discount price and flip it immediately after some fixing. He admits he is one of these realtor(Very honest, opinion-meter up). Later in the conversation, he mentions if he were to buy this house, he will try to offer cash with 20% below listing price and lender may take it also. I think he is trying to test me but I think he is giving me an option that may work to my best(opinion-meter up). The conversation is harmony and well overall and I leave happily seeing what options I can have.
This property is in a good neighborhood so I think some of his comment like 20 offers are valid. I believe he knows very well that FHA loan is not easy to be accepted by the lender. With 3.5% DP plus the 8K credit for first time home buyer, if the house is underwater next year, the owner is very likely to walk away because nothing is lost from buyer perspective except with a free house rent for a year or two. TAX PAYER lost 8K instead. That is why the realtor has not submit the offer to lender yet.
I pointed out CA's unemployment rate just shoot up to 11.5% recently and this will cause more foreclosure and no end is in sight. How can a bank keep holding back those foreclosure on the book while the supply keep piling up? He did not reply and steer the conversation to other topic.
We will see what will happen in October to Dec this year. Also, why bank can keep holding those REO? What needs to happen to force them to release those REO?
#housing