Negotiating With Banks/REOs
I am doing REO's and preforeclosures. My question is about negotiation tactics. If a REO is priced at 85% LTV and I offer 65% minus repairs and they counter (which I'm sure they will), what's a strategy that I can use?
I read that the longer a house has been sitting, the more motivated a bank will be to sell, HOWEVER, I read on Wells Fargo's REO site that they price their property at what they believe is fair and there really isn't much room for negotiation. I don't know if that was just trying to disuade some people or not.
Should I offer ridicuously low first? Or should I offer a range in which I'm willing to pay? Example, If I'm willing to pay no more than 70K, then offer 65K and keep going up but offer no more than 70K.
Any suggestions...
Dee 
I'm no authority. However, I'd always base my offer on some less than I can pay for the property and repairs,all the while with an eye on profits. I don't have a set percentage (although I do use the ARV formula as a guide), just a gut feeling. Now, I have lost deals because of my gut. But I've also had sellers call me back later to see if my offer was still on the table. The later affirms my gut.
Offer what makes sense for you, leave room for upward movement if you receive a counteroffer.
Be prepared for the bank to be an unmotivated seller. The bank may not be under any pressure to get rid of a property, and willing to wait for the buyer willing to meet their price.
Forget percentages... Support your your Offer with irrefutable documentation... and change their perception of value.
This process is much the same as in an application for short sale consideration... but easier! Why? You'll have an even MORE MOTIVATED (institutional) Seller, and not have to worry about an individual homeowner.
Read A Short Sale Primer... and utilize the same approach.