Currently we’re working directly with Citi and Bank of America to help them with their bulk REO sales. By “directly”, we mean DIRECTLY with their Asset Managers, where we talk to them on the phone, and they send us their REO lists.
If you’re interested in Chase Bank properties, we have to purchase them through a non-profit organization (NPO), where 2% of the purchase price goes to the NPO, in this case a church in Irvine, CA.
Buyers will pay additional 1%-3% of the purchase price for our services, in addition to the 2% that is paid out to the NPO for “cherry-pick” REO properties.
For properties that can be “cherry-picked” the discounts are as follows:
- Chase: 15%-25%
- Bank of America: 5%-15%
- Citi: up to 25%
- Wells Fargo – TBD
For commercial REO sales, please contact us, since the discounts vary, but don’t expect properties at 50 cents on a dollar.
For bulk REO sales from Citi, it’s a 50 property minimum buy, with up to a 25% discount, even though there’s no minimum bid on non-California packages. Their new protocol for bulk REO packages is as follows, as of February 2011:
- CitiMortgage will guarantee marketable title, but reserves the right to remove any property in which the recording of a transfer deed will result in the payment of liens, taxes or other payments, outside of normal document recording fees.
- Buyer will have the option to pay for the additional expense and retain the property in the sale.
- The removal of a property will result in a reduction in the offer amount based on the percentage of the overall offer compared to the aggregate list price of all properties.
- The properties will be sold as is and Citi will not be responsible for any traditional seller costs. However, Citi will provide a title policy at no cost to buyer.
- To be eligible to place a bid on the properties, please respond no later than Monday 2/14 by 5:00 p.m. CST. Then you will have 5 business days to submit your final bid. There is not a minimum bid amount, however Citi reserves the right to reject all bids at our discretion.
- The successful bidder will be required to remit a deposit of 10% of the total offer amount within 3 business days of acceptance, and then will have an additional 5 business days to perform due diligence. Closing will take place within 30 calendar days of offer acceptance.
- The offer must include all of the properties in one bid price.
In general, if you are looking to pick up properties at 65 cents on a dollar in volume from the banks, we are not able to do it for you. Banks do NOT give those kinds of discounts as an average discount, and were clearly told not to even bother submitting offers at 65 cents on a dollar.
If you are cherry picking, we can run comps and submit offers on properties that are under-priced by the banks already, so that your discount ends up being around 30-50%, but those will not be properties of your choice or chosen location. They will whichever properties the bank has erroneously priced under-market.
We work with direct buyers only – no Buyer Reps or Brokers, unless you are willing to put us in touch with your Buyers directly.
If you have any questions, please call:
- Angella Raisian, Broker – (310) 528-5789
- Teresa Straley, Esq – (310) 902-0346