How can we verify that an offer was actually submitted to the bank to purchase an REO property? The listing broker claimed that all offers except the highest one was rejected. However, he did not acknowledge receiving our offer, nor sent anything in writing. This verbal rejection was obtained after I contacted him for the third time (by phone; first two attempts were by email but he did not respond)---AFTER waiting 5 days for some kind of response from the agent upon submitting the offer. I asked him why we were not informed of multiple buyers or given an opportunity to submit best and final or even counter once. His reply was that we are rejecting all other offers and only dealing with the highest offer.

Since when does a a bank not want to get the best price and if other potential buyers are willing to raise their bids above the current highest offer, since when does a bank not want this? I feel that the agent may not have submitted the offer, especially since he has provided no written chain of correspondence. In my experience, all of this should be in writing by fax or email when dealing with REOs. Is there any way to verify whether or not the listing broker actually submitted the offer to the bank because I really don't feel in my gut that he did?

On my last REO sale, I submitted two offers almost at the same time. - the bank outright rejected one and accepted the other. They didn't counter either offer - just rejected one and accepted the other. So it does happen that they don't come back with a "highest and best" scenario.

Secondly, there was also no written rejection or "chain of correspondence". They just rejected the offer on their online site and that was that. Actually, I seldom get any fax or emails rejecting an offer - usually it is done through a website.

Don't know if that makes you feel better or worse, but that's how it goes for me.

Thank you very much concepts05. How do I find the site to see the rejection. Didn't someone had to tell you about where to look to check the status of the offer? I am just asking how you even knew that much if no one contacted you at all to tell you anything---which as been my case. Please PM me with details.

BTW, why did you submit 2 back to back offers? Did the listing agent give you any indication that you should?

Thanks again for sharing your insights. You have been helpful.

Offers are generally submitted through a company website for REO's. The listing agent imputs the terms and submits. Rarely do you hear a responce unless there is a counter offer or the deal is accepted. Everything is pretty much verbal after you submit the intial contract. Also make sure you submit the Proof of Funds letter or Qualification letter with the offer as well as the EM Check or that offer may not get submitted. As far as the agent not submitting, what would be his advantage of doing that. The more offers that come in the better the agent looks which equates to future listings. REO Listing agents do not make alot of commission generally, the lack of commission is made up in volume (at least in my area).

Price is not always the determining factor on these properties. I've won deals for a lesser price because my clients had a better finance package and were able to close faster. The AMs do not want to carry their inventory over from month to month, quater to quarter. I have a buyer/seller that only buys in the November and December. He comes in armed with cash and strong financing submits low offers with cash and fast closings. Prevents the banks from having to carry over the inventory to the new year. It works for him, and keeps me busy in the Holiday Season.

As far as a signed rejection, AMs only sign off on deals that are accepted. I just found out I lost 2 offers yesterday when I check them on the MLS. It was in pending status and I had no Addendums. I assumed my client did not get it so we move on to the next.

I've listed REO's in the past but prefer to work with investors and buyers. The nightmare of paperwork, and out of pocket expenses became a headache. Its rare that I take an REO Listing these days. I've worn the hat on both sides of your deal, as the listing agent, and as a buyers agent. Hope it helps.

Thank you very much, REODayton. Your shared experience was also helpful.

The REO agents in my are get 3% commission.

As far as what reason an agent would have for not submitting an offer, I can think of a myriad of reasons and none of them good or ethical. I will leave it at that because if I expound people will come in declaring how an agent would never do this or that or how an agent would not risk the license for this or that, when all of that is hogwash in the sense of absolutes. The fact is that agents in every state in the country are disciplined and penalized for some violation or another on a daily basis. Many lose their licenses. There are clearly agents who will risk for monetary gain or otherwise. My point is simply that there are more than plausible reasons why an agent might not submit certain offers; as a matter of fact I was talking with an REO broker last night who admits to routinely trashing offers before submission that HE deems unworthy---for whatever reason---of consideration by the bank and according to him it is common practice regardless of whether their offer was complete.

I really appreciate your response and it was indeed helpful. You both are obviously experienced and don't mind sharing your knowledge with those of us who are just starting out. I am a firm believer that good Karma exists for people like you and concepts05. I can now release my frustration over this situation. Thanks again.

Hope you're not from central Ohio, because you sound EXACTLY like someone who's called me multiple times on one of my REOs.

Anyway, here's my expirance with a situation.

I had a listing , List price of $139,900 , which needed ALOT of work , but it was in a awesome location and had about 5x the lot size as everything else in the neighborhood. We would get about 3 offers every friday for the entire listing period. I couldn't hardly handle all the paperwork as it needed to be scanned it , submitted with forms, and the like.

The last week of the listing till it was in contract, we recieved about 7 offers on the property ,some being VERY below asking ,and one or two very close to asking price. I submitted and the bank accepted one offer and never gave me instructions with the others. I had calls by agents saying "Why's it under contract, why haven't you called me back ,ect". The truth of the matter was - They were off by several thousand dollars, with the biggest complainer being about 10% off asking price while i other offers almost identical, and some being much better. The bank never gave me a counter, so i didn't send a counter. I had no reason to be shaky on it, I really didn't need to, i was quite happy with another sale that month. Yet i got accused , and called by a office manager, saying that i had witheled offers, ect. None of which i did...the bank just didn't want to reply.

Donedeal, I have had some REO listings and let me just tell you, the experience is totally different, at least mine certainly was. Working REOs can be extremely time consuming for a listing agent, especially if you have multiple listings; he or she is also working as a de factor property manager, as well.

When the property receives multiple offers, just uploading the information on each offer takes quite a bit of time. And, of course, if there are 5-10 offers on the table, you can count on multiple calls from 5-10 agents, adding to the frenzy.

In my case, the AM manager looks at them and either rejects all or accepts one. If that one is close on price and terms, he *may* counter, but he is not going to counter all of them -- he's going to pick the best of the lot and try to counter on that one. And that's it. No second chances, no paperwork trail, nada.

Quite frankly, no one has time to go back and forth - particularly not when most of these AMs are looking at a landslide of REOs coming at them over the next few years. My advice would be have the client make their best and highest offer, understanding that terms are also very important. While I always communicated back with the buyer's agents letting them know if they did not get the property, I also made sure they understood in advance if there were multiple offers, they may not get a second chance.

When my AM looks at offers, he does not dilly dally around, it's totally wham bam. It's more fast paced and you have to be ready for the ride. It's a different world! You are not always going to get the curtesies and niceties you may get in the "other" world.

Thank you all for the responses. You have been helpful.

As I intimated earlier, I am done with this matter. I don't want to let the unprofessionalism, laziness, lack of ethics, or anything else that an REO agent does, or does not do, irk me too long.

Maybe someone else will find this topic and any future responses useful.

And yet there are agents who do NOT present offers. I had an incident two years ago, where a lowball offer was sent to another firm for presentation to the bank. Although I was the Buyer's Agent at the time, I could not present the offer myself, due to the login/computerized method of presenting the offer that the bank used. A month later, after numerous phone calls, I finally was able to contact the agent's broker, as well as her MLS to report her. She admitted that she hadn't even bothered to look at the offer because in her mind it was "too low" for the bank to even consider it. She never once presented the offer, until her broker got wind of the situation. And yes, the offer was eventually rejected, but at least it was presented. If your offer was indeed rejected, you can request to see a printout of what the agent should have from the REO/Bank, indicating that the offer was actually rejected in writing...

I sold $800 million dollars in REO properties in California in the 90's as an outside asset managers for various large banks. Banks have lots of factors when condisering offers. Amongst lot of other things, they are frequently looking for new clients for the bank. So if your offer suggested placing a large sum of money in the bank for a period of time or taking loans out with the bank, it became a better offer for the bank.

There are no rules on how to negotiate a deal. There is no rule that say the highest offer has to win. There are also no rules on whom the bank may or may not choose to negotiate with.

As far as thinking the broker didn't submitt your offer, next time send the offer to the banker and the broker to insure this doesn't happen to you again.

As a broker, you need to question the bank and see what will make your offer the best. Also, you need to manage the expectations of your client. Tell them in advance that you might not even get a counter.