Posted by Jeff-FL on April 29, 2000 at 24:33:47:
Rita,
One quick question while you’re here…where or how do you find Fannies and Freddies to bid on? I know about the HUD properties, but have never been aware of the other two.
Thanks,
Jeff-FL
Fannie Mae-owned property - Posted by Rick-IL
Posted by Rick-IL on April 26, 2000 at 09:47:48:
Can anybody give advice on bidding for Fannie Mae properties?
I found one today at $24.5k that has been on the market for 4 months (due to previous title problems that have been cleared).
I would really like to pay 20k and the listing agent said that I should bid slightly under my desired price, and let FNMA “win” the negotiation by bringing me upward to the price I want to pay.
Does this sound right? And do you think $18,000
is a good place to start to arrive at $20k?
Re: Fannie Mae-owned property - Posted by Jen-LA
Posted by Jen-LA on April 26, 2000 at 10:24:26:
Rick- I recently bought a Fannie Mae for 18,900, they were asking 19,900. We initially offered 14,000 and they ALMOST accepted (according to the realtor) but then they decided to play hardball. According to a local realtor who deals with mostly FM properties, they have been really trying to get their resale prices up as they have fallen in the past couple of years. The only thing I can say, is offer WAY low, unless you feel someone else may outbid you. If you feel the house is a still a good deal at near asking price, then you have nothing to lose. The good news is that Fannie Mae has standards that their houses have to meet before they can resell them, such as newer roofs and wiring. This will often make the deal doable.
I would say go just a little lower than you think is too low, all they will do is come back, and if they don’t, bid again! If it’s been on the market for 4 months, they probably really want to get rid of it. Also, I’ve found that my realtor generally is wrong about what we should list, offer etc for houses- not sure if it’s because they want a little higher commission, or if they don’t care as much as you. Go with your gut.
Good luck!
-jen
by the way, we sold ours for 37,900 1 month later! Hope you do the same!
Re: Fannie Mae-owned property - Posted by Jim IL
Posted by Jim IL on April 26, 2000 at 10:08:19:
Rick,
Without knowing mroe details on the home, such as value? Repairs needed? Market Rent? etc. it is hard to give you an opinion.
But, the basic premise of making an offer at lower than what you are willing to pay is a good basic negotiation technique.
If you atart at your highest price, you have no where to go when negotiating.
And, you never know, they may just accept your lower offer.
Good luck,
Jim IL
Re: Fannie Mae-owned property - Posted by rita
Posted by rita on April 26, 2000 at 21:35:12:
Rick,
I purchase several Fannies a year. The lowest bid they have ever excepted is 85% of listed price. However the listed price may be higher than FMV.So waiting for a price reduction is sometimes necessary. When bidding Fannie & Freddies are notorious for countering, it’s a process with them, their required to counter at full price first, then usally twice more, the second at a 1,000-2,500 price reduction.
So if the property FMV is 24,550 X 85%=$20,825 which is the lowest they will likely accept, so if this is your highest bid Just a suggestion: I’d start my bid at
$17,550 on second counter come up 1,500, and if third counter occurs, counter highest bid $20,000.If you feel FMV is lower than the list 24,500 wait 15-45 days for a price reduction,and bid on the same steps.
Fannies can be wonderful investments in some areas,
Good-Luck!
rita_mo