Fannie Mae is offering a special offer to buyers of its HomePath® properties (Fannie Mae foreclosures). Buyers who close on a HomePath® property by June 30th can receive up to 3.5 percent of the sales price to be credited toward buyer’s closing costs.
The details of the HomePath® Buyer Incentive can be found here, but in a nutshell:
- The initial offer must be submitted on or after April 11, 2011 and close by June 30, 2011.
- Buyer must be an owner occupant and will be required to sign the Owner Occupant Certification Rider to the Real Estate Purchase Addendum.
- Buyers and/or buyer’s agents must request the incentive upon submission of initial offer.
Thursday I wrote an offer for a client on a Fannie Mae HomePath® property. In addition to making an offer at 5 percent below list, we also requested the 3.5 percent closing costs credit. Fannie Mae accepted my client’s offer the next day. Easy peasy.
So, if you’ve got you eye on a HomePath® property give me a call. But hurry, because the sale must close on or before June 30, 2011. No exceptions. And as this note from the HomePath website points out: “Fannie Mae can give no assurance on the time required to close, but initial offers submitted after May 15, 2011 are particularly questionable for closing by the incentive deadline of June 30, 2011.”
Guy Johnson
(775) 722-4011
Chase International
Factoid: In the fourth quarter of 2010, Fannie Mae was able to recoup 55% of the unpaid principal balance on the defaulted mortgages through its REO sales. Source: http://www.nationalmortgagenews.com/dailybriefing/2010_323/fannie-offers-deals-1024282-1.html
55% wow. So what does that mean? Fannie had losses of about $1,000,000,000.00 in taxpayers money just last year?
Oh wait, it doesn’t matter. We have already nationalized Fannie anyway.
Everytime Fannie sells one of these HomePath houses the taxpayers take it in the shorts.
5% below list which should put the buyers underwater at close.
Nice going
Brillant, how so?
Brilliant don’t you know that the value of Fannie REOs always goes up? There is simply no way that anybody buying a Fannie REO today will ever lose money. There has never been a better time to buy. Surely the value of a Fannie repo cannot decline from here. Everybody wants to live here and they are not making any more Fannie repos.
(Ok, well maybe there are several thousand more Fannie repos in the pipeline here in Reno, but that’s not anything we like to talk about).
Guy,
That 55% statistic seems accurate. Back when I worked full time, I did some independent research on FNMA foreclosures. In every case I studied, FNMA routinely foreclosed on the properties for the outstanding loan balance (taking no writedowns) but subsequently sold the properties for between 40%-50% of the loan balance.
And the taxpayer (the ones who are paying, anyway) is footing the bill.
Further–
The additional 3.5% incentive sounds like pouring gasoline on a structure fire.
I also wonder how many of these buyers are using FHA financing.