Novice needs REO help! - Posted by Hanah


#1

Posted by Mark (SDCA) on March 08, 1999 at 13:11:33:

Another point is that Fannie Mae typically rejects low ball offers. They are tough to deal with for investors. Geared more toward retail buyers.


#2

Novice needs REO help! - Posted by Hanah

Posted by Hanah on March 07, 1999 at 22:25:32:

THIS IS MY FIRST DEAL! I have located a Fanny Mae Property, REO. It is vacant, so I was able to view the property. It needs repairs of approx $10,000. In this area it is a strong sellers market with multiple bids frequently happening. To my knowledge there is two offers going out on this property as I type. My question is does it make sense to make an all cash offer which would accomplish 2 things: 1) a more appealing offer to Fanny Mae. 2) A plan of doing the improvements and getting financing after close and pulling the entire cash amount back out. Example: Listed property is slightly overpriced for 200,000. I offer $165,000 cash, and make the home improvements. At this point it will appraise for 210,000 and I can get a 90% LTV and recoup my initial outlay of $165000 + improvements and making $14000. I need constructive help and suggestions ASAP!


#3

Re: Novice needs REO help! - Posted by Tim (Atlanta)

Posted by Tim (Atlanta) on March 08, 1999 at 06:18:59:

I agree with PAT. You need to make a much better deal for your first (or any) deal. Remember, it will take time to sell the property, and guess who gets to make the mortgage payments in the mean time ? Also, even if you fix it up, unless you get a hard money loan (70% FMV) you will NOT be able to refinance the mortgage until you have the house one year.


#4

Re: Novice needs REO help! - Posted by PAT

Posted by PAT on March 07, 1999 at 22:51:40:

Hanah,
wow----
this is your 1st deal? 165,000 is alot to start off with–look at the spread-
your spendingto much for the house at 165k
if you get back 210k plus you need 10k to fix it
your first deal you should look at at least 70% below mkt value-- It could take 6mo. or more to sell it –
offer a lower price or look elsewere–
you can sell a house 10% below apraised value 2 or 3 times faster . factor inall these things LOOKFOR THE 50%-- 60% OR BETTER DEALS
PAT