Bidding on property owned by Bank

Layne

Hi, apologies if this has been covered elsewhere already. Viewed a property this evening and was told by the EA that there might be some wriggle room on the asking price as the property is owned by the bank.
I've heard banks are happy to take a decent offer, just wondering if anyone had experience of this. Btw the asking price is €65k but it requires about 20k to bring it up to a decent condition. We were thinking of putting in an offer around 55k??!!
Any advice greatly appreciated.

The_Conductor

Location? Are other people interested? If you go in low ball- and there are other interested parties, you're up the creek. If there aren't other interested people- maybe try for a little lower- on the basis of the amount of work involved. However- what is other property in the area going for? Is the asking price realistic? If you feel its on the high side- convey this to the estate agent.

Banks will take reasonable offers- however, if its already been marked down to below market value- you may find your offer declined.

Layne

The_Conductor wrote: »

Location? Are other people interested? If you go in low ball- and there are other interested parties, you're up the creek. If there aren't other interested people- maybe try for a little lower- on the basis of the amount of work involved. However- what is other property in the area going for? Is the asking price realistic? If you feel its on the high side- convey this to the estate agent.

Banks will take reasonable offers- however, if its already been marked down to below market value- you may find your offer declined.

Thanks for your response. It's in a large town in Kerry in an area where there are a few other properties for sale. They vary in asking prices from 50k all the way up to 90k. EA said there had been one viewing in the last fortnight and that person ruled it out on the spot due to the work required.
Also any idea of the lowest amount a bank will lend as a mortgage, we have approval for 80k (60k mortgage & 20k deposit) but if an offer of say 56k is accepted then we'd require mortgage of 42k, is this too low?? We've been told that 45k mortgage would be okay.

MouseTail

At this price point, the commission is usually too low for the EA to mess you about. They known the price the bank will accept. Have you asked outright what price will secure the property? It could be anything from €40k to €60k.

Ask your bank what is the lowest Mortgage, I'm surprised you were told 45, traditionally it was 50.

gaius c

Be aware that banks move slow and they are in no hurry re accepting offers. Most bank sales will have a minimum market period so don't blow your wad right away. Take your time, make your bid and if you top out, be prepared to be very patient.

The_Conductor

I'd add to what Gaius C has said. Banks have credit committees who meet periodically (in some lenders this could be every 2-3 months, some more frequently). These are the people who will eventually decide yes or no to your offer. When you make your offer- and don't hear anything back- don't presume its been rejected out of hand- it could very simply be the case that the meeting simply hasn't happened yet......

maynooth_rules

At the end of a bank sale purchase myself. Be prepared to have it drag on.

Layne

Thanks for all the replies and the words of wisdom. Was given the impression by the EA that the purchase would be straight forward and wouldn't take too long as it was being sold by the bank but judging from your experiences I can expect the opposite.
Time could be a problem as I have only 2 months left in my mortgage approval so the clock is ticking. Should I let the EA know this as a way of speeding things up or should I keep my cards close to my chest?? Any advice welcome.

Uno my Uno.

Banks will consider offers but they won't give a property away, they are in no rush to sell. If you only have 2 months on your Mortgage approval you may only have time to have one offer considered so a low ball offer could be risky in that context. Is there a reason why the mortgage approval cannot be extended?

Layne

That is what I was thinking too, an offer too low will be rejected and will run out of time before a new offer can be considered.
Regarding extending the mortgage approval I don't really know how that works. I take its not as straight forward as requesting one and it being granted. I had assumed that you would almost have to reapply for a mortgage from scratch again, that you get the 6 months and if you don't get things sorted within that period that then tough. Our circumstances have not changed since being granted our mortgage approval in December only that we now have more savings in the bank. How straight forward is it to extend mortgage approval normally??

Uno my Uno.

Layne wrote: »

That is what I was thinking too, an offer too low will be rejected and will run out of time before a new offer can be considered.
Regarding extending the mortgage approval I don't really know how that works. I take its not as straight forward as requesting one and it being granted. I had assumed that you would almost have to reapply for a mortgage from scratch again, that you get the 6 months and if you don't get things sorted within that period that then tough. Our circumstances have not changed since being granted our mortgage approval in December only that we now have more savings in the bank. How straight forward is it to extend mortgage approval normally??

Speak to your mortgage adviser about the extension, In your position I would have thought it should not pose serious difficulties.

If I were in your shoes I would offer what I thought the house was worth and I could afford to pay. Generally the banks are very slow and don't make counter offers so its like negotiating with a glacier. To me, it is better to make a one time best offer that is either accepted or rejected.