I just started research into real estate investing due to a house a couple doors down from me just (last week) went through a sheriff sale and now Fannie Mae owns the property. The outside of the property needs some TLC, I’m not sure what the inside looks like at this time.
I would like to obtain this property and use it as rental - at least help improve the neighborhood a little.
How is the best way to work with Fannie Mae owned property and get the best price. Will they take less than the appraised values - minus any repairs needed? If so what would be typical dicounted % value I could expect.
It may depend on the situation. In my area, many Fannie Mae properties are repaired before they are put back on the market, so the list price reflects the market value of the home. Do you know who the listing agent is going to be yet? (Sometimes there is a sign in the window.) If you do, call them and see if the property is going to be sold “as is” or “as repaired”. Good luck.
Thanks, for you reply,
I did call fannie mae after posting this question on the website, I was given the listing agents name. All of this has just taken place, the home owners are actually still living in the home. Fannie Mae did tell me that they have been given an eviction notice and should be out soon.
Since, I do have the listing agents name, will I be able to talk the agent into letting me placing a bid “as is” - at a decent discount. How should I approach the listing agent. I have heard that Fannie Mae and Hud properties are rarely discounted - they typically go for appraised value. I’m not sure whether that is true or not, but if there is a way to obtain this property at a good price I would appreciate any additional advice I could receive.
Since the former owners are still in the house, I’m guessing that the listing agent hasn’t been able to get inside to do an inspection. The agent will not be in a position to let you make an as-is offer if Fannie Mae determines that they want to sell it after it is repaired. Of course, they may sell it as-is.
As far as whether or not you will be able to get it at a decent discount, again it depends. What is your market like? Do most REO properties sell quickly and for market value? If the seller can list the house for market value (less any needed repairs) and get it, then they have little incentive to offer you a good discount.
The listing agent has not been inside the home. I not sure about the REO being sold at top dollar, since I’m just starting out. I do know that most of the homes in this neighborhood do sale for top dollar.
I was thinking since the sale just happened, if I can make an offer before the seller has any additional expenses, I might be able to get it at a good price. Do you think the listing agent would let me in to see it (and determine a repair cost and make an offer) before a determination is made by Fannie Mae to repair and sell.
If the property sales for full value, I doubt if I could rent/lease it for a decent positive cash flow - to make it worthwhile.
Any ideas on how to procede to make this happen, I haven’t been able to reach the listing agent as of today. I’m sure once I talk to the agent some of these questions will be answered, but is there anything I should say to the agent that might help my outcome.
First things first. Have your own agent. Best if you can find an Buyer’s Agent to represent you. The listing agent’s job is to get the highest and best price for the seller. Ask your agent to find out what the homes in your area have sold for in the past 6 months to a year. than compare the condition of the home and the asking price to come up with an fair offer. Your agent is key here. remember you do not pay their comission. The seller does and he or she(agent) can find out a lot more information for you. for one, what the house sold for to the last owner and maybe what is owed on the mortage. generally that is what fannie mae or any lender wants out of the deal just to break even with or without repairs.
Good luck! 8)
Thanks, for the info. I hadn’t even thought about using a buyers agent. Great advice.