Home Buying in Pacifica>Question Details

Tim Murphy, Real Estate Pro in San Francisco, CA

What's the story with Freddie Mac not responding to an offer? I made an offer over asking and 10 days later still no response.

Asked by Tim Murphy, San Francisco, CA Sun Apr 7, 2013

I made an offer $25,000 over asking for a property from Freddie Mac. No response from asset manager. Property is under "First Look" and we made an offer more than 10 days ago. Listing agent said that they want "all cash".

What gives? We have an 800 credit score with $125,000 cash down payment (25%), and loan approvals from 2 banks for $300,00.

We made an offer on a house over 14 days ago from Freddie Mac. I got no response from lisitng agent and govenment agency. Next week the property becomes available to investors. My agent tells me that "they" want "all cash".

Unbelievable! I made 9 offers in the last 4 months and all winning bids were won by investors. In fact, most of the them is now being rented out when it should have been sold to someone planning to occupy home.

I guess we will keep our money invested anywhere. It is too risky to trust real estate agents, government agencies, and banks. It seems that dishonesty is the new rule of the real estate industry.

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Answers

4
Tim Moore’s answer
How in the world are you saying it's a real estate agents fault Freddie Mac ignores you? Thank our government, they work for them you know.

I have a feeling there is more to this story than you have included in the story. I have only heard of all cash offers being accepted when the property obviously won't get a loan because of the condition. Is that the case here and you are making an offer with 25% down and wanting a loan for the rest and wondering why they have not gotten back to you?
1 vote Thank Flag Link Sun Apr 7, 2013
More to the story……yes there is…..Many people who want to live in a home are being shut out by investors who are lying. The homes being sold by Freddie Mac and Fannie Mae under the "First Look" program are being bought by investors who have no intention of living in them. This is against the rules.

Sorry, but my neighbors and friends don't get a warm and postive experience with they think of real estate agents. No more shadow inventory? No one under water? Everything back to normal. Right.

How did we get here in the first place? Dishonest loan brokers, real estate agents, and banks. Once again, people who paid their bills and follow the rules are being shafted. Now real estate agents are back to their crystall ball forecasting and have made bold predections disguised as facts. No more shadow inventory, no one under water, everything is ok now, prices are going up and up and up. Bid higher or you will be left out. Sorry, I don't think I will drink the kool aid this time around.
Flag Sun Apr 7, 2013
It’s like a world gone mad: hundreds of buyers lining up to get homes they can finally afford, but no matter what they do, they can’t seem to get one. Not just a San Francisco problem, it’s across the entire Bay Area. The result? Disappointment, frustration, even anger. Directed at whom?

Realtors.

It goes without saying that Realtors aren’t the root of the issue. Cash only for listings? We're only the messengers - we're not making up the rules. We’re not the reason that the Bay Area is experiencing an inventory crisis, nor are we responsible for soaring prices. Just like we’re not responsible for record low interested rates. Larger forces are at work. We are, however, the most visible targets in sight and, ipso facto, the ones getting the heat. So much so that many buyers, having written numerous offers with one Realtor, are switching to another and another and another just to see if the next has some market secret the first, second or third didn’t have.

It’s time for everyone to take a deep breath and remember how we ended up here. The market reversed in February, 2012 and has been a seller’s market ever since. Foreclosure listings have dwindled to a trickle (there is NO foreclosure shadow inventory in the Bay Area). A majority of normal sellers have decided to sit tight. Many distressed homeowners, previously under water and candidates for short sales, are now back in the black. Others have decided to capitalize on low interest rates to invest in their current digs and remodel rather than relocate.

Consequently, inventory is down 25% from 2013. Additionally, cash buyers are out in throngs, causing a Bay Area wide jump in cash transactions from 31% last year to well over 40% in Q1, 2013. And they are not just investors - many families are pooling cash resources to help other family members buy a home they will personally live in.

Sellers, sensing blood in the water, are demanding offers be written with no appraisal contingency since it’s obvious they won’t appraise at offered prices. In the midst of this, some buyers still believe they can offer under asking because they don’t “feel” any given property is worth as much as others are willing to pay. Realtors, trying to advise buyers what they need to do to get a home, become the bad guys because buyers don’t like what they are hearing. Thus they switch to another Realtor, hoping that somehow something magical will happen.

In your specific case, it's not the listing agent who decides whose offer gets accepted. If they say the listing is "cash only," it's usually because of condition or title issues and it's the bank and asset manager insisting on cash, not the realtor. If they say "cash only", don't bother writing an offer on it with a loan - they will ignore it because you didn't follow the rules.

9 offers? Some have made over 20 before they get an offer accepted. Like it or not, the market has changed, and if you want a home, you are going to have to figure out the current rules of engagement ... and play to win.
1 vote Thank Flag Link Sun Apr 7, 2013
Tim:

Thanks for insulting my integrity, intelligence, work ethic and the hundreds of clients who’ve been thrilled with the services I provide.

No offense intended? Seriously?? Every offense received.

Message here? With an attitude like yours, blatant cynicism, hints of conspiracy theories and your general distrust of all in authority including the government, it’s no wonder you’re having a tough time. I’m assuming you are writing offers on your own – I can’t imagine a Realtor knowingly working with someone like you, since, by your definition, they’d have to be inherently dishonest ...

Maybe you should be buying a home in Canada or Mexico …
Flag Tue Apr 9, 2013
Typical response from a real estate agent….. Sorry but honest+real estate agent is an oxymoron. No offense, but general perception is that real estate agents are the same as "used car dealers". Sellers are the government and they demand all cash?

Message here is …….Taxpayers bail out the banks. Banks foreclose. Banks sell to big investors. This is a government created bubble.

And why is the government NOT selling to families who want to live in the home? Give me a break.
Flag Sun Apr 7, 2013
Tim,

I read your reply to Carl in which you state that “honesty + real estate agent is an oxymoron.” In that reply you show that you are a “builder-developer”. You did not reveal that in your original question. So much for your integrity and honesty!

But I could be wrong…

Perhaps you only sell houses to families who want to live in them; you refuse to sell to investors and you insist that the buyers take out loans to buy your houses and you refuse to deal with cash buyers.
0 votes Thank Flag Link Mon Apr 8, 2013
When there is a home that needs a lot of work, it may not pass an appraisal. The key fact is that listing agents and asset managers want offers without any contingincies. They want to know when they accept an offer that the home is sold and will not fall through. Now with Freddie Mac you are experiencing a problem i have complained and reported on for years. Too few agents receive these listings and can not possibly handle all of them with assistants or policies of cash only. Freddie has not realized that this hurts them further and keeps giving all the listings to these same agents. The way Fannie and Freddie sells homes is flawed and no one cares. When I get a bank owned listing it is cared for and treated as like it is my own home. It gets the time, attention and the asset manager gets the service , comments and updates to help sell the home quickly as possible, at the best price and without issues. Your best bets are to try and eliminate or reduce all contingincies and perhaps search for non Fannie or Freddie homes for a better outcome. It is discouraging for us agents just as much as the buyers to see this happen. I would love to list them to show they could be sold the right way. I sure wish the fannie and Freddie would improve their response time as most other banks from weeks to a day.
0 votes Thank Flag Link Sun Apr 7, 2013
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