Making offers on reos

About the best contingency you can put, that the bank will not call you on, is due diligence (this includes inspections). Make the due diligence period as close to the settlement deadline as possible. The bank will always put their own dates on there anyway, but it gives you a starting point that they may agree to. With the due diligence clause, you can walk for about any reason you want.

As far as low ball offers go. I don't know where you are, but in my area, the banks haven't been too keen on accepting low ball offers for about three years. They pretty much have the property condition factored in and there are so many people trying to buy them, that most have competing offers on them. At least the ones that are worth pursuing. That may not be the situation in your area. It would definitely be worth checking into.

You want to keep your offer as clean and with as few contingencies as possible. Your offer will have a better chance of getting accepted that way. I've had deals where my offer was higher and fairly clean, but they took another offer that because it had a shorter closing time and no financing (I was using hard money).

Keep pushing and you will succeed.
Good Luck,
Jim

My realtor always ads in an inspection sheet and she says this will work for a contingency should I just not use an inspection and just use the due diligence??

And I'm assuming if your offer is accepted you do your due diligence before you give your EM??

Inspections are part of your due diligence and should be under the same umbrella. On our state purchase contracts it is verbalized in the due diligence section. It even has a box to mark that specifies your purchase is contingent upon your due diligence. You can even mark that it isn't a requirement on our REPC. Thoroughly read the contract your agent is using and see if that due diligence section is on your state's purchase contract. Every state has different laws. So, it may or may not be on there in the same way as in my state.

You will have to deposit EM upon acceptance. That usually occurs when the bank sends the corporate addendums. They will require the EM to be deposited when you return them. They will ask you to include proof (copy) of the check and/or verification of deposit. More times than not they will require you deposit the EM at their designated title company. The title company will give you proof of that deposit. If it is a HUD foreclosure, the check will be required when you send them the full contract.
Jim

at least ten business days to do your inspection. Some REO"s will try for a shorter time, if so, just insist to your re agent that you need the ten days. Also, know your market as lowball in one area is a different number in another area. You may be doing blanket 50 to 65% offers, but you should still know your market.

And also are banks accepting offers with POFs by like best transaction funding??

Banks will always ask for POF. They want to make sure you will follow through with the purchase. In my experience, any approval letter, as long as it is strong, will suffice.
I have one, from a hard money lender, that states I have a line of credit up to $200,000 with him. It is very generic. Sometimes the banks, especially HUD, will want an address on the letter.
I would start with generic one and see if it works. I've found, most times it will. Again, HUD will always want an address.
REO's are a great way to get discounted properties. And once you learn the process, it is very simple. Over 90% of the deals I've done, over the last 15 years as agent and investor, have been REO's. I like them, because you pretty much know what your going to pay and how long it will take to complete the transaction.
Jim