re: Real Estate Question: Haggling a Foreclosure

I work with the ORE property of a large bank in Louisiana. Much of the information in this thread is not accurate with regards to how our particular bank handles repossessed property. Additionally, the concept of the bank getting the money lost back from another source is news to me, when the bank makes a bad loan it takes the hit (this statement is based on the size and quality of the house you are specifically looking, around $600k and not some rural development loans).

If the bank has already had the ORE property on their books for 18 months, they have most likely already written down the book balance and lowered the asking price accordingly. Personally, I would not be offended if someone offers a lowball price, but I may just decline the offer without a counteroffer as I don't deem a really lowball offer as a legitimate offer. If the initial offer is in the ballpark, then I would certainly counter.

Unless the property has something significantly wrong with it (which should be reflected in the price), then there is no need for the bank just to unload a property for significantly less than what it is worth. There is always a little play in the numbers, as there is with any real estate deal, but we get so many calls from folks that think they are going to buy stuff for pennies on the dollar ... And that just isn't going to happen with a bank that has stockholders to answer to.