Straw Offers Merely Make Additional Work For Everybody.
If you remember last week, Kevin and Fred spoke about Matt Vernon, the executive at lender of America who came to Arizona last week. Mr. Vernon chatted to more than a thousand real estate experts openly about deficiencies at lender of America.
One of the things that Mr. Vernon spoke about was the ‘straw’ offers that choke up the system. In essence , a straw offer is an bid that is so unreasonable that the bid will not get approved. Kevin and Fred think that you should never send an bid to the lender that you do not think will get accepted. The straw offer only hurts this progression. You’re giving yourself more work, the bank more work and you are slowing down the process for anyone that has a short sale listing in the system.
One of the scariest things is that there are short sale guidance courses out there that teach this as a regular practice. Basically, the agent will take a listing and put in writing their own investor offer for an unreasonable amount so that they can get the short sale process started. In the mean time they can get a negotiator assigned and get a BPO prepared. All the while, the broker is hopeful to unearth a real buyer and switch out the real buyer with the phony buyer.
Nonetheless, if you get a BPO completed, the BPO value may not be applicable when you finally get a valid buyer. At the end of the day, you are hurting the whole community and the value that you assume you have in this straw bid process only works out one in ten times. You are not assisting yourself by using the straw bid process. On behalf of other real estate brokers and lenders across the country please end this process!
Get powered up by Kevin and Fred at Short Sale Power Hour by the Short Sale Specialists of Arizona