Is Fannie Mae jerking us around?

Asked by joshuawest82, Atlanta, GA Thu Aug 9, 2012

We recently went under contract on a Fannie Mae owned condo. We initially offered about 4% under the listing, but agreed to the listing with 3% closing costs. The property is a foreclosure and missing several appliances, but we like the area enough that we were willing to go with it.

Now is the weird part. First, the MLS listing never changed to 'Pending' or 'Under Contract'. Second, once the appraisal came back under the list price, we've gotten into something of a bind.

We cannot cover the difference between the sale price and appraisal, and I refuse to go Homepath. The listing agent offered to meet the appraisal cost, but would REMOVE the closing costs completely. We cannot financially make this work between now and the closing, and they refuse to move the closing out. Is Fannie normally this painful to deal with? Is there anything we can do?

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Ron Thomas, Agent, Fresno, CA
Thu Aug 9, 2012
Considering that you put in the Contingency for Appraisal, as well as Contingency for Loan,
you are covered.
The House isn't worth enough, and you can walk away, losing nothing.

You did put those Contingencies in, didn't you?
1 vote
We did. The issue is the nearly $1000 in inspection/appraisal fees we will have to eat.
Flag Thu Aug 9, 2012
Rodney Mason, Mortgage Broker Or Lender, Atlanta, GA
Thu Aug 9, 2012
This is exactly why you should be using the HomePath loan program and nothing else. Had you gone that route, then you would not have an appraisal issue since an appraisal is not required. Now that you have an appraisal, your lender cannot ignore it.

I always strongly advise my borrowers to go with HomePath financing on HomePath eligible properties. Those who do not follow that advice are strongly cautioned that they may risk closing by using a different loan program.

Additionally, there is very little to a condo approval on a HomePath mortgage. FHA and conventional mortgages both require more extensive condo reviews.

Based on what you have said, your only real other option would be to switch lenders and go HomePath.

Regards,
Rodney Mason, NMLS #151088
Sr Loan Officer
Prospect Mortgage
825 Juniper St NE, Atlanta, GA 30308
Office: (404) 591-2453
rodney.mason@prospectmtg.com
Apply Online at http://www.rodneymason.com
Licensed in Alabama & Georgia

Prospect Mortgage offers a full selection of mortgage programs including:
Conventional | FHA | FHA 580-639 FICO | FHA 203K Renovation (Streamline & Consultant) | HomePath® | HomePath® Renovation | HomeStyle® Renovation | VA | USDA | GA Dream | Jumbo Financing
Web Reference:  http://www.rodneymason.com
0 votes
Another issue: We did not know there was going to be an issue until today, one day before out option runs out. Thanks to absurdly slow response times, they ate away all our time. Now we have almost no way to make the closing date, and we ALREADY spent money getting the current lender ready. I realize that's a sunk cost at this point, but there's no time to meet the closing deadline anymore.
Flag Thu Aug 9, 2012
No appraisal for Homepath is one of the reasons I avoided it. No appraisal means I don't know I'm getting screwed on the deal. Homepath has crappier rates than I can get elsewhere, and worse closing costs.
Flag Thu Aug 9, 2012
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