Wednesday, August 27, 2008
How many bids did you say?
It's no secret that the real estate market is being challenged with a lot of foreclosures as well as a growing number of homeowners facing foreclosure.
Lenders don't want to foreclose and take back properties because it's a big liability for them. One option they offer is to give a discount on what is owed to them so it's easier for the seller to find a buyer. This is commonly known as a "short-sale".
The challenge is for the lender to figure out how much a property is truly worth. They usually pay for BPO's (Broker Price Opinions), but as the title suggests it's still just an opinion.
There is a solution that is gaining popularity quickly. Real estate agents with clients facing foreclosure, are starting to use online bidding to help the lender determine true market value of a property while also finding a buyer.
As a lender, there isn't anything more convincing than being presented an offer in a short-sale situation for a property that has been marketed for 2-3 weeks and has received over 100 bids.
The lender, homeowner, seller and Realtor all benefit from this process. No wonder there is a growing number of agents using this process.