ANOTHER problem with buying REOs/Foreclosures (broker, inspector, price)

[SirObongo]

Hi,

I think this is extremely important for REO buyers
to know about this.

I bought two REOs in 2008/2009 and worked through
the well-known problem of understanding the
legal and physical state of the property given
the bank is an absent owner.

However, in a recent transaction, another
***new type of problem*** arose, that my
friends (also buyers) have run into and
my broker says is becoming common.
Here is the typical situation.

We were the only buyers, offer was above
asking price (we were in a hurry). Inspector
found a problem, so we called in a specialist
who said there was a simple fix. This added
a two day delay to the entire process (but we could
still close on time) so we asked for a two day
extension.

The bank then throws everyone for a curve ball
and says they no longer want to sell us the house
and we are taking too long. Whoa! Drops us like
a cold fish, two weeks later the property is still on
the market, no buyers.

This is VERY serious problem with buying REOs
since you typically have to invest 40-80 hours researching
them and then to have a bank drop you is a huge waste
of time.

Personally, I'm going back to the stock market.
Vanguard never turned down one of my checks!

Note, the good faith deposit was returned, no problems
there. It's though they were unhappy we were doing due
dilligence and researching the property. This is something
you need to do when buying an REO hence the big problem.