All Forum Posts by: Eric Peterson

It sounds like you're buying a HECM house (that's what Fannie Mae calls properties that are the result of a reverse mortgage foreclosure). Those are not handled through HomePath. We've listed a few of them where I am. Of course, we also make the buyer's agent send us a signed Fannie Mae RE Addendum with the offer, which Fannie Mae does require (although they do not check for it). I usually include a copy of it in MLS attachments. It sounds like the listing agent is not doing their job. Definitely cuts down on confusion, although I agree that the Addendum could use some updating. You'll also notice that every page has to be initialed, even the signature page.

 Yes, after looking at the end part there, it does look like the agent put in an offer of $136,000 with $7000 in repair costs. It doesn't change the fact that she didn't consult her clients prior to doing that, and, like I said, those repairs would be done by contractors of Fannie Mae's choosing, not her clients. The better tactic is to ask for some closing costs back, although you'd be hard pressed to reach $7000 that way, you could make the deal a little more attractive.

That said, she has no business changing an offer without asking the clients. It does not matter if it is effectively the same (even though it isn't, for reasons I've outlined above). It's in violation of license law in my state, and I imagine every other state in the union. It should never be done.

@Jay Hinrichs

HomePath (Fannie Mae) only requires the initial offer to be signed, all counters are done electronically through the website without rewriting paperwork each time (basically, verbal). Obviously, the final documents must be signed. Been that way since I've been a listing agent for them.

@Arianne L.

I know you're trying to be nice and I know you like this woman, but at this point I would probably have fired her. She's not following your directions and, to be honest, she sounds like she doesn't understand foreclosures in the least and most of what she told you looks like unvarnished BS. It's not her decision to make as far as repairs go. Also, you probably don't want Fannie Mae's contractors doing the work, which is what would happen.  She's also wrong about the algorithm thing, there's a sales rep that looks at offers and decides on the counters/acceptances. They aren't that far on the forefront of technology. 

She is, however, right about the multiple offer round. When two or more offers come into HomePath on a property, it automatically goes into a multiple offer round with a deadline for highest and best. It is all automated and verifiable, so, in spite of what I said above, I'd give her your best offer to take to Fannie Mae and ensure she doesn't add anything to it. After that, I'd drop her.

If your comps are coming up at $225,000 and they're bigger than his house, then the ARV is probably not $260-270,000, but closer to $210-215,000 (spitballing, because I don't know your area). This is without me knowing many details, such as are the houses similar styles? Similar ages? You should be basing the ARV off of the comps, and it sounds like comparable houses are actually selling for less than what he's asking.

Just plug $210,000 into Matthew's formula, so $138,500. That's a lot less than what he's asking, and I'm wondering if he's really that motivated or just looking to see what he can get for the house.

@Brent McQuilkin

There's a lot of information we'd need to know to tell you that. How much does the house rent for? What are your monthly expenses? Are either of the houses going to need any capital improvements (roof, HVAC, etc..) soon? How much money do you have saved? I mean, unless rents are way high in Florida, I would think trying to live off of the income of single rental house would be tough, but without the numbers, it's hard to say, one way or another.

@Kimberley Harrell

Fannie Mae listing agent here. The biggest issue is the time frame. 1 day before closing is rough. I have had the same thing happen to a listing (pipes were stolen while under contract). In that case, the sales rep went ahead and approved the repair (we had the contractor replace the stolen copper with pex and PVC for a large drain pipe). The big difference is that we were still a few weeks out till closing. The agent shouldn't be freaking out and she should immediately let the sales rep know what happened (she's also obligated to file a police report on Fannie Mae's behalf). Yes, it's a stressful situation, but that doesn't excuse what seems like unprofessional behavior to me. 

Chances are, the closing will have to be extended in order to either do repairs or negotiate a new price, as the Fannie Mae closing process is pretty cumbersome and specific and you'll need an amendment and new HUD if you renegotiate or time to do repairs if not. Given the circumstances, any reasonable sales rep is going to work with you on this. Also, in case anyone wasn't aware, Fannie Mae no longer uses Asset Managers for their REO properties, everything is done in house. That change occurred a few years ago.

@Nat Chan

I've been a Fannie Mae listing agent for a number of years, and what Mark said is absolutely the course you should take. Fannie Mae has very specific rules about how multiple offers are handled, and divulging other offers is expressly forbidden. Call the fraud hotline. On another note, the agent is not authorized to negotiate like that on Fannie Mae's behalf, the sales rep is the one that counters offers, so if he's lying about multiple offers in an attempt to bring your offer up, he's still in the wrong. If he's acting in an unethical manner that's contrary to what Fannie Mae expects, they'll want to hear about it.