Freddie Mac REO property owner occupant contract

[Sam Leon]

Had my eyes on a Freddie Mac property. Called the listing agent to inquire, said they already had an offer from someone, an owner occupant.

LA asked if I am investor or OC, I said investor looking for pay cash. He said well you could write up a contract as a OC just have to sign an affidavit. I said nah, I'll wait the 15 days and will call you back then.

After the waiting period is over I called the LA and he said yes there is a contract but he thinks it will fall apart. I asked why? He said because there is a lot of damages to the house and the HOA has asked for the repair amount to be put into HOA escrow and the buyer doesn't have the money to do that.

So if they need a new roof estimated 20K a new kitchen 10K they need to put 30K into escrow, and once they finished the new roof, the HOA will release 20K back to the owner, which means the owner needs to have double the repair amount to make this work, and the LA says the owner does not have money to do repair, yet the bank accepted his offer and now they are in the middle of negotiation with their HOA to sort out this escrow issue.

Now I have gone through executing contracts with Fannie Mae but not Freddie Mac but I have never seen anything in any of those REO addendums that allows the buyer to work into it any special provisions for HOA escrows and I have never heard that the bank would be willing to work with the buyer on stuff like that.

Is Freddie Mac basically obligated to accept owner occupant contracts no matter how much contingencies and potential issues there are, they basically have to accept those offers before they even consider investor offers or would they look at them side by side at some point?