Agent buying houses

[Tami Y.]

There's a real estate co. In my area that gets all the Freddie Mac listings. The listing agent purchases all the houses thats understand 20k under his girlfriends name, keeps them in the awful condition for the time period the sells them for sometimes4x's what he paid for them. My agent is saying he is getting away with because she is not related, but if she is buying all these homes it's not owner occupancy or does that not matter. I know whe we try to buy Fannie Mae we have to wait X amount of days, the agent is saying his gf is owner occupancy, he works for a terrible company that does the same thing. This is ridiculous, we completely remodel all of our homes and provide a great living for our tenants. They sometimes don't even list the properties, or we find out day 1 on MLSand they say they already received accepted offer. Thoughts?

[Joel Owens]

You have Fannie Mae which is Home Path and Freddie Mac which is Home Steps.

If it's his girlfriend it's not family but generally you must disclose.

There should be an owner occupied period for Home Steps.You CAN just as in HUD submit an investor offer before the investor period opens up and then you already have your offer in but it won't be considered until the bid period ends.

If she is buying after the owner occupant period it should not matter.If she is buying before that time she is most likely committing loan fraud and will end up in prison.If for a fact you know that same person is buying in the owner occupant period and signing that they intend to occupy the home then they are committing fraud.

It's hard to know what is going on without being there.It could be legit or not depending on the timing and disclosure in buying the property.

[Chris Martin]

Regarding "If she is buying before that time she is most likely committing loan fraud and will end up in prison..." I think you meant "If she is buying before that time with or using a mortgage she is most likely committing loan fraud and will end up in prison..."

[Jon Holdman]

Originally posted by Chris Martin:

Regarding "If she is buying before that time she is most likely committing loan fraud and will end up in prison..." I think you meant "If she is buying before that time with or using a mortgage she is most likely committing loan fraud and will end up in prison..."

The mortgage doesn't matter, Chris. You're confusing getting an OO loan with bidding on these properties during the OO period. Even if you're paying cash, you can still be committing fraud if you're buying properties during the OO bidding period, claiming to be an OO and then not occupying them. Seems like it would be difficult avoid getting caught if they're doing that over and over.

On the other hand, its not clear from Tami's post that's the situation.

[David Beard]

I'd be a little careful. You're casting a lot of aspersions, and it would be quite easy to identify this party based on your given location.

That said, I've no doubt there are REO listing agents manipulating the foreclosure process by purchasing through proxys, using their insider position to achieve the winning bids.

[Tami Y.]

I do not know if she is buying them for cash or getting a loan, it's actually her boyfriend the agent buying them and using her name. They are buying them prior to being available for investors saying it's owner occupancy, but how can this be when she never lives in the house, has multiples houses under her name?

[Jon Holdman]

If these are Fannie Mae Home Path homes that are being bought by an investor during the First Look period, report them.

http://www.homepath.com/contact_us.html

It should be easy to figure out if the girlfriend really has closed on multiple properties claiming OO status. It should also be easy enough to determine if properties purchased in the OO period are being resold quickly. This stuff is all in public records.

If he's buying them legitimately (not claiming to be OO), then there is nothing wrong with titling them in his girlfriends name and then reselling them later at a big markup.

[Tami Y.]

It's Freddie Mac

[Chris Martin]

A couple quick points, but I pretty much agree in concept with Jon's posts. First, loan fraud doesn't exist if there isn't a loan. That was the point in my first post. Second, the owner occupancy issue is a contract issue. The remedy for breach is in the contract, specifically in the Owner Occupant Certification. But, alas, this link is to a Fannie Mae document, not one by Freddie Mac. Fannie Mae isn't Freddie Mac. I do not know if Freddie Mac has the same language:

"In the event that I do not occupy the property as my primary residence in accordance with the above certification, I shall pay Ten Thousand Dollars ($10,000) to Seller..."

[Jon Holdman]

Freddie Mac contact info:

HQ 1 - PHO I
8200 Jones Branch Drive
McLean, VA 22102-3110
(703) 903-2000
Toll free: 1-800-424-5401

http://www.freddiemac.com/corporate/about/contactus.htm

Give them a call.

[Steve L.]

If you feel it is blatant, I would submit it to Freddie Mac and I am sure they will investigate.

1. The agent is supposed to let Freddie Mac know if they feel that is "reasonable" that this person would occupy the property. (eg: check what else they own, etc).

2. Your evidence would be a lot better if you have records of higher offer you've sent that did not get accepted.

They will take it pretty seriously if it is legit.