Banks were never set up to be long-term holders of residential real estate, much less play the role of real estate negotiator or speculator. As you've found, some can be downright curmudgeonly to deal with.

Bank asset managers often have little or no real estate background and can be overwrought by high foreclosure volume or have their hands tied by market uncertainties and unrealistic parent-company expectations. Some smaller banks haven't dealt with enough volume to know how to streamline their dispositions.

Typically, an REO property gets relegated to an asset manager's already bulging portfolio after no one at the foreclosure auction or courthouse sale was willing to pay the institution's minimum. Even though banks today are selling off REO properties for, say 75 cents to 90 cents on the dollar, the bank in your case may have thought your initial offer was absurdly lowball and quickly dismissed it -- and you -- perhaps without justification.

Most bank asset managers will first get a broker's price opinion, or BPO, on a property and, in the case of this property, may have been inflated and never modified to reflect the falling market. Or, there may have been one or more liens on the house, which can drive up the price when those liens must be satisfied as part of the sale.

If buying a bank owned property is the direction you want to travel. You will need to find a Realtor that has as much patience as you will. It’s will be the road less traveled. Like anything else in life anything good usually comes with a price. In this case we are looking for a lesser price.

You and your agent may well benefit from resubmitting and redating your initial bid. You must submit comparables, but did you also furnish repair estimates or photos to justify your offer, assuming it was somewhat lower than those comparable sales?

If you're not dead-set on getting that house, but still seek an REO bargain, you might just have to move on to a more flexible bank. If you have a steely resolve and can afford to be even more patient in this instance, the bank's board and (or) shareholders are bound to start complaining soon about all the REO expenses eating into their already thin profit margins, which could loosen things up for more sales.

Buying a bank owned property can save you thousands of money but like anything else I always say have a plan and do your homework!

<?xml:namespace prefix = o ns = "urn:schemas-microsoft-com:office:office" />