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Old 06-18-06, 07:51 PM   #1
Evil
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Real Estate - The practice of "lowballing?"

We are selling a house in Michigan. The times are tough right now, and it's a buyers market I'm told.

We need to move because of my job, and have lowered the price to a point where we are taking a loss.

As of today, we are in a situation where someone was looking at our house and another house. We were told that they were buying either our house or this other persons house. Our house is cheaper by 25,000 and in better shape.

The good news is, we were just informed by our agent that the buyer wants to make an offer on our house. They are going to make an offer at the end of this week.

The bad news is, that their Realtor informed our Realtor that they would be making a "Lowball" offer to us.

My question is, What can I expect? What is an average lowball offer? What is lowballing, and what is just insulting? Any help would be appreciated.

This is my first house, and it sucks that I have to end up losing money from it. I don't want to come away from it in the hole too much....

Second question.

Is their any lender out there that is going to lend me not only the money for my new house, but allow me to roll over the loss from the first house into a new loan?

HELP!
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Last edited by Evil; 06-18-06 at 08:01 PM.
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Old 06-18-06, 07:54 PM   #2
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Quote:
Originally Posted by Evil
Is their any lender out there that is going to lend me not only the money for my new house, bur allow me to roll over the loss from the first house into a new loan?
Not until any term that any sane person could consider reasonable.

Wouldn't it be easier to rent your Michigan house for the next year?
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Old 06-18-06, 07:58 PM   #3
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Or simply say, you won't accept the lowball offer.
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Old 06-18-06, 08:04 PM   #4
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Our house has been on the market for over a year and now this is the first time that anyone has shown any interest.

It's not that it's a bad house, it's just that it's not in the most desirable of areas.
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Old 06-18-06, 08:13 PM   #5
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A year? Ouch. I'd just take the loss and move on.
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Old 06-18-06, 08:16 PM   #6
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"A year? Ouch. I'd just take the loss and move on."

I'm pretty sure that's what we will end up doing. As long as it doesn't put us too far in debt.

It's just that we don't have the out of pocket money to pay off the full loan with the loss that we are taking.

Does anyone have any suggestions on how to get the money? Personal loan? 401k? Has anyone been in this situtaion before?
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Old 06-18-06, 08:29 PM   #7
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I have had some relatives sell off their flooded houses at a loss which sucked for them but they were happy that they quickly detached themselves from the situation.


The thing is to be brutally honest about the real value of the house and center your expectations around that point. An offer that's maybe more than 20% below that point is probably an insult.

You also should be brutally honest about the cost/benefits of letting the house sit on the market even longer.

Maybe you can help the price by throwing in the appliances and furniture if they are in good condition.

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Old 06-18-06, 08:31 PM   #8
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I just listed my house on the market and its been a tuff go....lucky for me its payed for and i don't have to sell if i don't want 2.


IMO,
unless its a crack price lowball offer i would take it...like you said its a buyers market!!! the nation had a unheard of run up in realstate values for the last 4 or 5 years.....buyers now can be picky and rates are going up...there is a glutt of homes that rival the early 90's real estate bust.....imo the bubble will burst sooner than later...here in california they will be jumping off of bridges cuz they can't payback there loans...its going to be bk city!!!


like they say>>>what goes up must go down


I HOPE YOU GET A GOOD OFFER
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Old 06-18-06, 08:35 PM   #9
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If your house has been on the market for a year, perhaps you should consider another realtor.
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Old 06-18-06, 08:41 PM   #10
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Quote:
Originally Posted by Duran
If your house has been on the market for a year, perhaps you should consider another realtor.
This is our third.....
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Old 06-18-06, 08:43 PM   #11
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Forget about price and think about it in terms of whether or not it lets you get on with life.
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Old 06-18-06, 08:58 PM   #12
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Quote:
Originally Posted by kvrdave
Forget about price and think about it in terms of whether or not it lets you get on with life.

And I belive that it will. I just need to find someone to give me the money to pay off the old loan....
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Old 06-18-06, 10:01 PM   #13
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Well, maybe you have some refinancing options that can help.

For example, take the money from the potential house sale and put most of it towards the old loan and refinance the remaining amount which should greatly reduce the monthly payments and hopefully enough left to start over somehwere else.
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Old 06-18-06, 10:19 PM   #14
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Quote:
Originally Posted by Ranger
Well, maybe you have some refinancing options that can help.

For example, take the money from the potential house sale and put most of it towards the old loan and refinance the remaining amount which should greatly reduce the monthly payments and hopefully enough left to start over somehwere else.
How is he going to refinance a mortgage when he will no longer own the house?
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Old 06-18-06, 10:35 PM   #15
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Hmm. That's a good question.


I guess another option is to take a loan from the bank and use that to pay off the difference on the mortgage.
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Old 06-18-06, 10:53 PM   #16
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If I were bidding on a house that had been on the market for a year - I would also make a low ball offer. Especially if I know the sellers are desperate because they are moving, etc... Now - when I make a low ball, I also expect the sellers to counter offer - usually at a split between the asking price and the low ball. For example - say the house is listed at $200k - they make a low ball offer of $160k - I would expect a counter offer at around $180k. I may re-counter at $170 - or just take it. But if you are going to be taking a loss by selling now - I would seriously consider renting it out. Unless you are expecting on taking some of the gains (if there are any) as a downpayment in your new place. While the real estate market is cooling, the rental market is actually picking up in many places. But if your location sucks, might not be a viable option.
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Old 06-18-06, 11:52 PM   #17
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Quote:
Originally Posted by orangerory
If I were bidding on a house that had been on the market for a year - I would also make a low ball offer. Especially if I know the sellers are desperate because they are moving, etc...
And yet you wouldn't eat meat because you don't like how the animals are treated.

You may not get it, but I find that very amusing.
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Old 06-19-06, 12:38 AM   #18
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When we sold our house last year (also in Michigan) the very first offer we got was an extremely lowball offer. The house had been on the market for about 3 or 4 months at that point and we countered. The buyer never even responded to our counter offer and my realtor told me it was made by an investment group who was just going around making lowball offers on different houses to see if the could get a deal I guess.

We ended up taking the next offer we got who was actually someone who liked our house. I wasn't happy with the offer considering the amount of money we had put into the house, but at that point we just wanted it sold since we financed our new house with a bridge loan and that loan was coming due soon. Once we paid off our loans, I guess we were "ahead" because we got about $5K back, but we originally thought we would be getting about $25K back, which would have paid to finish the basement in our new house.
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Old 06-19-06, 06:26 AM   #19
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In my neck of the woods, lowball offers are ways for people who aren't so interested in the house to see what shit sticks to the wall. Sellers are accepting them, putting the buyers in awkward positions, but it may be more as to what you all said above - houses just aren't selling.
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Old 06-19-06, 06:54 AM   #20
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Quote:
Originally Posted by JMG
unless its a crack price lowball offer i would take it...like you said its a buyers market!!! the nation had a unheard of run up in realstate values for the last 4 or 5 years.....buyers now can be picky and rates are going up
This has nothing to do with the housing bubble. Nothing. Local markets, as well as national markets, are mostly running on employment numbers. Good employment and you'll see a healthy market. High unemployment and you see Detroit, Michigan.

IIRC, Detroit was like this two years ago when everyone was talking "housing bubble"...
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Old 06-19-06, 07:20 AM   #21
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[quote=Jadzia]When we sold our house last year (also in Michigan) the very first offer we got was an extremely lowball offer. The house had been on the market for about 3 or 4 months at that point and we countered. The buyer never even responded to our counter offer and my realtor told me it was made by an investment group who was just going around making lowball offers on different houses to see if the could get a deal I guess.[quote]

Thanks for the tip Jadzia. Do you know who this is?...
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Old 06-19-06, 07:30 AM   #22
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Evil where do you live in michigan? My wife is a realtor, and in this area, Central part of Michigan whole damm area is down 28% from last year. Just curious. Personally I would rent the house and you and your family rent to until you find a suitable buyer and tell these people to take thier offer and shove it. Unless you really just want to move on with your life. Michigan will turn around I hope.
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Old 06-19-06, 07:33 AM   #23
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How long have you lived in the house? Do you have any credit cards? Any of those checks from the credit cards? Normally, I despise credit cards and would avoid them at all costs, but this may be your only option. And whereever you're moving - for GAWD'S sake do NOT max out the amount you can borrow. (ie if the bank says you qualify for $200K, try to stay at $160K or less. That's the only way you'll dig yourself out of this. Also, make sure you have an EXCELLENT buyer's agent. Otherwise you'll be buying the wrong house again!)

If your house has been on the market a year, and you've had 3 different agents try to sell it... damn.

There are 2 things that will sell a house and nothing more. Location and price. You can have the best agent in the world, but if you screw up those two things you aren't going to sell your house (well except in that stupid CA market )
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Old 06-19-06, 07:50 AM   #24
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mosquitobite

We have lived in the house for 4 years. Thanks for the tips on the loan portion.

themovieguru

Grass Lake. Where are you? I'm not really in the business of becoming a land lord, and there are certain factors that are forcing us to move now. Otherwise I would have either left it on the market for a while longer or just taken it off until things picked up.
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Old 06-19-06, 08:00 AM   #25
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I live in the central part of Michigan
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