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fannie mae foreclosure

10 years ago

We are looking at a fannie mae foreclosure. Anyone have any experience buying from fannie mae?

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Comments (11)

User
10 years ago
They are very much "as-is" ... you might be able to get an inspection, but they don't fix things.

Expect damage. My SIL bought one and the jerk who lost it carefully sawed partway through some of the pipes with a hacksaw and painted over the cut so it would spray all over when the water was turned on. He filled faucet risers with caulk, P-traps with cement, and disconnected a lot of wiring.

It was a mess to straighten out.
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ncrealestateguy
10 years ago
You WILL be able to do a home inspection. And if you find something you do not like, you can terminate the contract and receive your deposit back. If the home has safety issues or is missing appliances or has structural damage, a conventional loan is your only choice... no FHA, VA or USDA financing. Time from contract to close is about 30 - 45 days.
LazyGardens, did your SIL not have a home inspection done.
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I feel so bad for you. There is nothing worse than a thief. I am glad the locksmith showed up when he did. Otherwise he would have gotten by with it. That cellphone has sealed his fate, I assume. Hang in there. I am sure the sellers had insurance and will fix it. Also, remember construction always comes in over budget. I have a hunch that it will cost more than 4K. Maybe let the sellers fix it and give them a bid contingent on the repairs being properly done. That way you can have it inspected before you bite the bullet. If you aren't satisfied, no deal. You must be so emotional. You will be ok. This just gives you more time to plan, pack, and save some money. (:
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Really, once Fannie & Freddie put the house on the market, they're ready to get rid of it. They may try a high-ish list price for the first couple of months (proving to themselves that they can't recover as much as they'd like to), but once you make an offer, things move at a good pace. It takes only a few days to get a response, & the response is short & sweet; they either take your offer or they don't, or they tell you they'll accept it if you'll do x or y or z by a certain date. Once you have an executed contract, you the buyer have deadlines for getting financing, etc; if you don't do your inspections on time, you lose the option; if you don't close on time, the seller will terminate the contract & put the house back on the market.
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Comments (10)
Also want to add this: assessed value is NOT the same thing as appraised value. One, assessed value, has to do with how your property taxes will be computed in order to be in line with other properties in the same taxing district. It is often a completely different figure from market value. That it is different is immaterial if all the properties in the same taxing unit are similarly at variance with their respective market values according to the local laws regarding assessments. The other, appraised value, (which is what I think you probabaly meant) has to do with a number determined by comparing recently sold, more or less similar, nearby properties to yours and making specific adjustments based on any differences in time, details and proximity to you, to come up with a predictive number for the likely range of price your house might sell for today. It is the number that your lender will use to determine how much they are willing to lend to you with this property as collateral. Since you mentioned being a first time buyer, I thought you wouldn't mind me pointing out this info. If you really did mean assessed value (taxable value) be aware that your lender may completely ignore that number in favor of the appraisal amount. Loans that pay out more than the contract price (i.e. money to make repairs in addition to the purchase price) are not normal loans and may have some added costs due to higher interest rates or conditions. Be sure to ask about this. Typically lenders will lend up to a certain amount of the appraised value and buyers must come up with the rest. Don't take on more house than you can comfortably swing just because you can "qualify" for more. If you are a two-income household, what would happen if one of those income streams was interrupted? Be sure you understand what it would cost to make those repairs. Would the roof see you through another winter? Good luck! L. PS: Everybody stretches a little financially when purchasing a first house, I think. A little stretch is a good thing (teaches financial discipline), but it should be a little stretch in the context of also having some reserves, just in case the little stretch is a mite too far. If it's a little stretch with no reserves, then you're asking for trouble. We live on a farm that when we purchased it was twice what we had been looking at. We had to really scrape by for awhile. But our definition of scraping by didn't dent our emergency fund, or retirement savings, it just meant we had no money for anything else except necessities, including none for fixing up the house. We just opted to live in it for that time until we had built up a cash reserve to make repairs.
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Comments (6)
Yes HUD in this particular area pays FMR, which is $1441/mo. Quote I received today was 4.5% on a 20 year, no points bringing PITI to $1080/mo, or a positive cash flow of $361/mo. This will be my fourth Section 8 property. In my experience, Section 8 tenants are a little higher quality since getting a nice house is the biggest thing to come across their plate in a long time. They tend to stay very close to the 'nipple' so to speak, and the houses are immaculate when I show up. Repairs between tenants, I wouldn't know, I have the same tenants year in, year out.
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barbcollins
10 years ago
If you find one on the homepath website then it probably has already been appraised, and you can get a mortgage with only 3% down.

Some properties also qualify for a "renovation mortgage" based on the "as completed" value.
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User
10 years ago
ncrealestateguy ... Yes, she did, and the "inspector" missed all of those little sabotage things because he didn't bother to make sure the water and the power was on, just looked and said, "Yup, it's a house".

She was not happy with him, and neither was the agency.

It ended up being a nice rental, and a very profitable resale, but it was a lot of work to undo the sabotage.
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ncrealestateguy
10 years ago
Glad it worked out.
But it is the responsibility of the to - be - purchaser to get the utilities turned on before the inspection takes place.
At least here it is and everywhere else I know of.
OP, most lenders give you a 10 day period to inspect and terminate, so make sure you, the inspector and your agent are on the same page on the timelines.
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bscaff
Original Author
10 years ago
Thanks, everyone. I live in a small town and think I know all of the issues with the home. I have even been able to check it out pretty close. There has been some broken windows, not much else. I am pretty sure I will be able to get an inspection. We are paying cash and are currently living in our rv so we will get to bid within three days. I just don't know how much to offer. This home should sell for about $90,000.
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barbcollins
10 years ago
Ask your agent what they think, and don't be afraid to offer low if you want. I have been shocked to see some of the low final prices on foreclosures.

We viewed a foreclosure over the weekend, and I asked our agent what she thought we should offer.
Asking price $52K, I was thinking $45K, she said with cash, offer $35K
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LOTO
10 years ago
I have sold quite a few Fannie/Freddie and other bank foreclosures as well as several short sales (which I hate) and it has always been the sellers responsibility (in the contract) to make sure water/electric is on and they have never balked at this.
Do an inspection and if there are major issues that come up you can ask for them to be repaired. I have had Fannie replace septic systems, wells, roofs, provide home warranties, and many times credit buyers 3% for buyer prepaid/closing costs.
If you don't ask you will never get. Most of the Fannie foreclosures are listed with 3 different agencies in my area and the listing agents are total professionals and other areas might not be so fortunate.
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ncrealestateguy
10 years ago
Most lenders now keep the utilities on during the listing period. Use to be not that way at the turn of the collapse. For the ones that are not connected, it is the buyers responsibility to have them turned on. Sounds like it may be a regional thing. Ask your agent.
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bscaff
Original Author
10 years ago
The bank turned down an $80,000. bid on a short sale just prior to foreclosure.
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ncrealestateguy
10 years ago
Does not matter. Just write up an offer and present it to them.
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