Home Buying in Fort Worth>Question Details

Kim, Home Buyer in Texas

Fanne Mae Negotiating

Asked by Kim, Texas Wed Mar 4, 2009

I have recently submitted an offer with Fannie Mae. The house is price ok, but it needs LOTS of work which is to be expected for a foreclosure. They countered our offer today. We asked about 16k less than list. They can back 4k less than list. How willing are they to negotiate on the price? We submitted a counter offer which is between our original asking price and there counter offer. Also, what is normal response time from Fannie Mae on a counter offer.

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Kim,
It is not list price that is an issue it's market value. Anyone including banks can list at any price. We just closed on a FNMA forclosure about 20% off market value. Buyers still bid below asking, but got about the same $4000 off. They might have paid list to get it though. One of the cleanest foreclosures I've seen.

Often it just depends on the deal and what their BPO came in at. Sometimes those are right on the money and should account for needed repairs and market. Sometimes they come in low and sometimes high. Asset managers are busy as are the REO agents, but I would normally expect a response in 24-48 hours. Your agent will have to call and call and call and email and fax, to make sure the bids get entered. If at first you don't succeed keep trying. Resubmit after a couple of weeks if you don't get an answer. Things change.

Also don't expect to close on time. Everyone on their side of the transaction from agents, to title, to asset manager can be painfully slow or non-responsive at times as they are extremely busy.
Web Reference: http://www.teamlynn.com
0 votes Thank Flag Link Thu Mar 5, 2009
Bruce Lynn, Real Estate Pro in Coppell, TX
MVP'08
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I am working with an agent. This area there are NUMEROUS foreclosures. All the sold foreclosures comps in that subdivision have gone below list price. There are two subdivisions in this area. The one that we are looking in is not as sought after as the other. The other one we have bid on several foreclosures and have been beat out by under $1,000. We are not asking for any concessions (CC).
0 votes Thank Flag Link Wed Mar 4, 2009
we are working with a bank and was told that even though the property needs work the bank will not take a viable loss....what I mean by that is you went 16k under and they came back at 4k. I think your counter offer will probably be counter offered again - but keep in mind the bank, in all its fabulous glory, doesn't want to lose more money. It probably has a cut off pt. Are you asking for a seller subsidy? If not I have been told a way to get your foreclosure offer more looked at is ask for a seller subsidy and then tack that onto the asking price. Okay lets say the list is 316,000 and you bid 16k under so the bank would be getting 300k clear....Now if you ask for a 3% subsidy that would be just over $9000.....So your under asking price would be only 7000 under the list with a 3% subsidy making your offer be $309,000 rather than $300,000. Since its a higher offer thank 300000 it will probably get weighed more heavily. I realize that you allready submitted your offer but if this one doesn't work out maybe this would be an approach for the next one....I hope they accept your bid!
0 votes Thank Flag Link Wed Mar 4, 2009
See blog below which may help answer some of your questions, but your agent needs to be your true guide.
0 votes Thank Flag Link Wed Mar 4, 2009
Hi Kim
I am curious as to whether you are working with an agent? The reason I ask is that is the only way you can get a good market comparison to actually know what the market value is. As far as what you should negotiate depends entirely on the market value of the home. If the list price is truly fair market value and the bank responded they may not make another counter. I know in some of our recent negotiations once the bank countered the first time they were done. That may or may not be true in this case. Good Luck we hope you get the house!
Pam
Web Reference: http://www.MBYRealty.com
0 votes Thank Flag Link Wed Mar 4, 2009
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