Fannie Mae deed restrictions and rekey fees

[Mark Yuschak]

I'm growing really tired of the Fannie Mae deed restrictions and rekey fees. Is there any way around them?

I made an offer on a FNMA REO and we negotiated back and forth. In each one of my counters I had "no deed restrictions and buyer will rekey at his own expense". Each of their counters that part of my counter was removed. Eventually we reached a price agreement. I countered it once again and INCREASED the price and again added in the language of "no deed restrictions and buyer will rekey at his own expense". Just today I found out from the listing agent that my offer was rejected since they can't remove standard language from the addendums.

This proves to me that the deed restrictions and rekey fees are more important than what they net. Why do they really care if we resell the properties for a profit? And why do they find it prudent to charge $150 for a cheap set of used locks?

This really makes no sense and gets me hot under the collar.

Anyone have any tips or tricks on how to get those off the addendums?

[J Scott]

The rekey fee is part of the addendum, so I believe that the asset manager can't negotiate on that. As for the deed restriction, while it's part of the addendum, you need to check a box and fill in the parameters (price, time period) to make it an inclusive part of the contract. So, in theory, if the asset manager doesn't check the box, the deed restriction isn't part of the deal.

Now, that said, it may be that the asset managers are following the company rules by always including it, and may not be allowed to "not check the box." Though I've seen times IN THE PAST when they've done this for me (whether they went against the rules or not, I don't know).

In my experience, this is how things used to shake out on deed restrictions:

- 1/3 of the time they forgot to check the box
- 1/3 of the time they agreed to remove it when I tried to negotiate it out
- 1/3 of the time I couldn't negotiate it away

But, over the past 6 months or so, I've had a different experience:

- 1/4 of the time they forgot to check the box
- 3/4 of the time they refused to remove the restriction even though I've tried to negotiate it away

So, it's possible they've gotten more stringent on having to include the restriction (unless they forget).

Or maybe my sample size is just too small to be meaningful... :D