Hello,

 I would appreciate any feedback!

I have a home we received and offer. It is lower then the WF appraisal that is 3 mo old. WF will not reduce off their appraisal at all! The buyer is well qualified and the offer is fair. The area this home is in is very difficult to find comps. We have the option of ordering another appraisal but with the limited comps I am not sure it will help much. Also I was told that if I do another appraisal now they will not do anymore.  Has anyone had a success or suggestions for how to handle this?

 

Thank you!

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Hello Jessica,

 

I had a very similar experience with Wells Fargo just a few weeks back. My listing was a fixer upper and Wells Fargo had completed several BPOs on the property and was convinced the value was higher than any offer I had received. They seemed hell bent that they were right and the property was worth more than the offers.

 

What I did was I kept an accurate history of every showing I had and included as much buyer's agent feedback as I could collect. I put together a very detailed argument showing why the offer I had was a fair offer. I sent over my complete showing history with every agent's contact information and welcomed them to call any of them and ask about the true value of this property and why their client was not interested. In addition, I included my own comps (both sold AND active listings) CMA valuation (which there were not ANY good comps), and included an argument that BPO agents were struggling to value this property because of the lack of good comps. How can you really put a value on a property if there are not good comps to use? I then reinforced that my showings and offer history are absolutely the best indicator of true value. If you kept good enough records, and can present a good argument, then the bank WILL listen to you. The negotiation process is ALL about creating a good argument, and then backing it up with real data. Before sending this argument off, I was certain they just wanted to push this to auction. But, my argument was compelling enough for them to do a full reversal on their decision and approved my offer quickly. We should close in the next two weeks.

 

Blaine Washburn

Keller Williams

www.StopForeclosureUT.com

 

Wonderful information, thank you so much.  I will give it a shot.

Blaine Washburn said:

Hello Jessica,

 

I had a very similar experience with Wells Fargo just a few weeks back. My listing was a fixer upper and Wells Fargo had several BPOs on the and was convinced the value was higher than any offer I had received. They seemed hell bent that they were right and the property was worth more than the offers.

 

What I did was I kept an accurate history of every showing I had and included as much buyer's agent feedback as I could collect. I put together a very detailed argument showing why the offer I had was a fair offer. I sent over my showing history with every agent's contact information and welcomed them to call any of them and ask about the true value of this property and why their client was not interested. In addition, I included my own comps (both sold AND active listings) CMA valuation (which there were not ANY good comps), and included an argument that BPO agents were struggling to value this property because of the lack of good comps. How can you really put a value on a property if there are not good comps to use? I then reinforced that my showings and offer history are absolutely the best indicator of true value. If you kept good enough records, and can present a good argument, then the bank WILL listen to you. The negotiation process is ALL about creating a good argument, and then backing it up with real data. Before sending this argument off, I was certain they just wanted to push this to auction. But, my argument was compelling enough for them to do a full reversal on their decision and approved my offer quickly. We should close in the next two weeks.

 

Blaine Washburn

Keller Williams

www.StopForeclosureUT.com

 

Good feedback Blaine.  I had this same thing happen to me on a WF short sale.  But..my situation was the the appriser included the enclosed Golf Cart garage as part of the home square footage, thereby pushing up the comps.  I got several of the managers to order a new Appraisal based on this explanation.  The new appraisal came in $200,000 lower and right where my offer is so we're starting all over again, but they would NOT even counter my offer originally.  Said it was simply too far below their Valuations and if I couldn't get that price, there would be no Short Sale.  I did have the comps, just needed an educated appraiser, but the showing history is good feedback if you don't have the comps  to support your offer..
I met with a Wells Loss Mitigation exec today. You have to pick your battles wisely.  If you can verify that your offer is FMV or something close to it then you need to send all of your comparables in to dispute the BPO value.  Do you know who the investor is?

I have a similar situation with Wells right now and B of A is the investor. Property is on a septic and it is uncommon for this area of L.A. and is very tough to sell.  Wells countered at $880,000, finally got them down to $750,000 but Buyer does not want to budge higher than $720,000.  Negotiator says there is nothing she can do. I've sent comps, photos of deferred maintenance, mentioned the septic tank which stinks a million times and provided a list of repairs as outlined by Sellers disclosures. Please help. What else can I do?

There are still a couple things you can do:

1. Do you have a showing history with enough data to support your offer on the property? If so, that can be very compelling. Do not be afraid to share buyer agent contact information and welcome the bank to call any of them for their opinion on the value of this property, and more explanation as to why their client was not interested. My property had shown 60 times with 4 offers at or below my offer presented to the bank. So, my argument was compelling. Keep track of those details, because they are powerful. If you don't keep this kind of data on your short sale properties, you need to start right away.

2.You mentioned a list of repairs from the seller disclosures. One trick I did on one property was have a contractor come in and actually put together a bid to repair ALL the problems with a property. Make sure it is a licensed contractor who can supply a license #. The bank is much more likely to believe you if you submit repair estimates for problems from a licensed contractor.

3. Have you been keeping track of buyer feedback? There are software programs out there that sends feedback forms to the buyer's agent asking what their value perception of the property is, and why their buyer didn't buy. This buyer feedback is powerful.

4. Regarding comps, make sure they are fair comparables that you can back up and explain. Banks are extremely hesitant about accepting comps from a listing agent because we all know that comps can be manipulated. When you send a comp to a bank, be sure to include an explanation of properties you have excluded and how you derived that comp. If you do that, and they can see your honest intent, then they will be much more likely to respond to your comps.

5. If the BPO value they have is quite a bit too high, another possibility is that the BPO agent is also an REO agent and gave the property too high of a value hoping to get the property back as a listing. Recently I started digging on one transaction that I was struggling with on value. The negotiator was good enough to tell me what properties the BPO agent used for comps. I did some digging and found that the comps were over 9 months old and sale dates were falsified. That BPO agent has since lost their contract with the bank. They probably should also lose their license. This is more common than many people realize.

 

Remember that Banks DO NOT want to send properties to foreclosure. They only do this if they feel it is their best option to give them more $ in the end. So, if you can create a compelling argument with the RIGHT kind of data backing up your argument, you will get the bank to reconsider. The bank's perception of value on a property is very often wrong and it is our job as Realtors to correct and convince these very skeptical entities. That is how we earn our skimpy $ on short sale transactions more than anything. Hope this helps.

 

Blaine Washburn

Keller Williams

www.StopForeclosureUT.com

 

Ed Romero said:

I have a similar situation with Wells right now and B of A is the investor. Property is on a septic and it is uncommon for this area of L.A. and is very tough to sell.  Wells countered at $880,000, finally got them down to $750,000 but Buyer does not want to budge higher than $720,000.  Negotiator says there is nothing she can do. I've sent comps, photos of deferred maintenance, mentioned the septic tank which stinks a million times and provided a list of repairs as outlined by Sellers disclosures. Please help. What else can I do?

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