began.
BANK ERROR
Banks know that if a buyer makes an unsolicited offer, most of the time, the offer is below fair market value. In one case, a bank lost more than $30,000 on a mistake based on that assumption. Two people were interested in buying a piece of property. It was in an excellent location and unique among properties available in the area. Both buyers were anxious to make an offer before someone else could offer more. Either one of them would have been willing to pay the fair market value of $100,000 for the property. Money was no problem; both buyers had the ability to pay in cash. Unfortunately, the bank refused to take any offers on the property. They would not budge until it was listed on the open market. For some reason, possibly due to an oversight, they put the property on the market for $67,000. First, the bank underpriced the property by $33,000. Second, the hired agent didn’t market it properly. Errors were made in the MLS listing. As a result, it did not show up in search results for other agents who had buyers looking for that type of property. The address was incorrect. As a result, the listing did not show up on any of the real estate websites that use a map display. Finally, the agent neglected to put a sign on the property. (The person who eventually bought it lived down the road and drove past the property every day.) After the bank refused to work with the buyers, each waited for the listing to appear. When it didn’t show up in searches, they gave up. Ultimately, both buyers moved on to find other pieces of land. Meanwhile, the property sat on the market, unnoticed. Because of the agent’s errors, no interest was generated, and the property went into foreclosure.
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