How often are bids approved by banks? - REO Property Preservation Forum
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post #1 of 13 (permalink) Old 05-27-2012, 04:52 PM
mab413
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How often are bids approved by banks?

Hi,
New to the forum and property preservation business. I just started 2 weeks ago and work with 2 national companies. I already have bid on 5 jobs that need alot of work. Seems like most of these properties have not been worked on in a year or 2 since the bank has owned them. I was wondering what is approval rate with this banks?
Thanks
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post #2 of 13 (permalink) Old 05-27-2012, 07:16 PM
LCG
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It's a low bidder thing. Good luck!
post #3 of 13 (permalink) Old 05-27-2012, 09:18 PM
concretemasonry
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Bankers do not know the business and there not that much a bank examiner can do is to approve using the lowest bidder. They are in the business of getting rid of the property at a low price as soon as the possibly can (once they can act legally) , even though it has been vacant for a long time.
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post #4 of 13 (permalink) Old 05-28-2012, 08:09 AM
PropPresPro
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Quote:
Originally Posted by mab413
Hi,
New to the forum and property preservation business. I just started 2 weeks ago and work with 2 national companies. I already have bid on 5 jobs that need alot of work. Seems like most of these properties have not been worked on in a year or 2 since the bank has owned them. I was wondering what is approval rate with this banks?
Thanks
It mostly depends on if the property is pre-foreclosure or REO. Pre-foreclosure capitol improvement bid approvals almost never happen, however, repair approvals do get approved if you are working with the the right regional/national. It seems some service companies can 'make' things happen where others fail.
On REO properties, it depends on the bank. There are a couple of banks that seem to approve almost anything I bid, repair or capitol improvement, and there are others that wont spend a dime.

In my experience, competitive job pricing is a must, but being the lowest bidder doesn't always matter. Especially after an asset manager gets to know you and your company, and realizes you do what you say you'll do, and on time, and correctly and professionally, they will typically want you to do their work, to make their job easier.

I have recently shifted the focus of my business to concentrate almost solely on REO rehab/remodel work. It always was a part of our business model and it always is the most profitable part. We have made a name for ourselves amongst realtors/brokers and have even been contacted directly by asset managers for consultations, creating the scope of work for a property, and estimates. After trimming the fat, we now have a business relationship with several realtors/brokers and 2 national companies (one of them informed me last week that they now call us first for all jobs, statewide) that routinely approve well over 75% of our repair and capitol improvement estimates.

Good luck, and be careful!
post #5 of 13 (permalink) Old 05-29-2012, 09:41 PM
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Quote:
Originally Posted by mab413
Hi,
New to the forum and property preservation business. I just started 2 weeks ago and work with 2 national companies. I already have bid on 5 jobs that need alot of work. Seems like most of these properties have not been worked on in a year or 2 since the bank has owned them. I was wondering what is approval rate with this banks?
Thanks






It goes like this.............................. You bid, and bid, and bid, and bid, and bid, and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid.................................. you get the picture yet???





And once in a great while they'll approve a $100 item.



The reason these guys want bids is to turn into the home owner's insurance or the bank's insurance and make them a big pay day with out actually fixing the house up and marketing it.
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post #6 of 13 (permalink) Old 05-30-2012, 04:37 AM
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Yep, lots of times we are told by the broker not to sweat the details of the bid, it isn't going to get approved.
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post #7 of 13 (permalink) Old 05-30-2012, 09:19 AM
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Quote:
Originally Posted by BPWY
It goes like this.............................. You bid, and bid, and bid, and bid, and bid, and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid,and bid, and bid, and bid, and bid.................................. you get the picture yet???








And once in a great while they'll approve a $100 item.



The reason these guys want bids is to turn into the home owner's insurance or the bank's insurance and make them a big pay day with out actually fixing the house up and marketing it.

You forgot the part where you forget to bid or miss something and right away they approve you to do it for free.

Rich
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post #8 of 13 (permalink) Old 05-30-2012, 08:57 PM
sunkist
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just bid one last week 66k, told my roofer google earth dont even go out to address, when i went there 3 contractors there at the same time, guy goes you can see what needs done email bid and departs thru the same window we all used to get in!!
post #9 of 13 (permalink) Old 05-30-2012, 09:08 PM
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Working for both Hazards and P&P. Many P&P bids are not reviewed as BIDS, but as a flag for hazard claim. Some nations have their own claim departments, many of them don't. Also we do know for fact that in many instances Banks inquire bids from few companies. on a fun note, approvals from ins company can be funny, we still trying to figure out if they only cover materials the way they were priced 10 years ago. If you in P&P you don't bid - you report damages. We did see some plumbing repairs approved on P&P bids, nothing major. P&P budget is limited and not intended for repairs, that is why there is not much done on many properties, especially if there was no ins before or during the time house went into foreclosure. So, don't waste your time on bidding, you just report damages, places, source, cause and etc
post #10 of 13 (permalink) Old 05-30-2012, 09:44 PM
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Quote:
Originally Posted by RichR
You forgot the part where you forget to bid or miss something and right away they approve you to do it for free.

Rich






I did.


Nice catch.
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