Citimortgage (this Ain't No Short Sale)
I have a strange deal going. House was 2 days from court sale date. Owners called. I talked to citi and they "checked with "fanny-may" then agreed for a 30 day delay and SS package. Package was turned around in 4 days and 7 days later they did a full appraisal. Appriasal came in at 88k AS IS. I offered 79k. they refused. They say come in at 85k and maybe they can get it by "fanny-may". I said you want me to pay reatail? She said if they don't get real close to the 88k they will let it go to sale. The court house price would be 85k including fee(s) etc.. There is no PMI on property.
1- What is all this fanny-may crap?
2- Are they counting on someone bidding 85k at the court house?
3- Are they just playing me?
Thanks, Kirk
It could be that they have some type of limitation imposed by "fanny-may". In any case they do not seem very motivated, I would pass, if I were you. I wouldn't even consider this a deal at 79k.
There is more to the story....The ARV is 120k and will need very little (5k) max. The bank doesn't know the insurance co. is doing a lot of repairs due to vandalism and the repairs are almost completed. The appraisal was done before the work was started. Why did the bank send me a short sale package if they want appraised value???
That's is Fannie Mae. This is a government backed mortgage lender that buys conforming mortgage loans from banks and leders. They don't deal with comsumers. They let the lenders who are serving mortgages to deal with any issues with comsumers.
In this case, CITI is the one who originated the mortgage or servicing the mortgage.
If I were you, I would just wait until this is listed as a REO. I bought a property from Fannie Mae before, and I paid for $45,000 less that the original mortgage balance and $35000 less than as is value. You might need to wait for a few months to get this good of deal. We bought it ten months after the property was foreclosed on.
Just remember, this property possibly will be auctioned off at the steps. It sounds like it will less likely happen though.
Good luck.
Fannie Mae is only the largest underwiter of mortgages in the world. To quote from their website
Quote: Fannie Mae is a New York Stock Exchange company and the largest non-bank financial services company in the world. It operates pursuant to a federal charter and is the nation's largest source of financing for home mortgages. Fannie Mae has pledged through its "American Dream Commitment" to expand access to homeownership for millions of first-time home buyers; help raise the minority homeownership rate to at least 55 percent; make homeownership and rental housing a success for millions of families at risk of losing their homes; and expand the supply of affordable housing where it is needed most. Since 1968, Fannie Mae has provided $6.3 trillion of mortgage financing for 63 million families.
So maybe before you conclude that Fannie Mae is "crap" you ought to go back to Mortgage 101 and start over.
With an "as is" appraisal in hand for $88K they are figuring that the property has already been discounted for its current condition. Yes, it is quite likely that somebody will pay at least $85K at the sherrifs sale I am hearing from all over the country that properties are selling at the courthouse for as much or more as they are selling through the MLS.
You pays your money and you takes your chances. Citi has told you what price they would take to sell. You can pay that price or you can hope that they get it back at the sherrifs sale and you can hope that the price comes down to the price you are willing to buy at and you can hope that nobody else finds out about it and buys first.. This is called the real world. FNM doesn't care enough about you to bother to play you.
I know who Fannie Mae (Fanny May) & Freddie Mac (Big Mac) are. I don't understand why the Citi wanted to play the short sale game which was done with all mine and the sellers required hoopla then wants a offer which is retail value.
You answered your own question. They started the SS then got an appraisal. If they had known it would appraise above the amount owed they probably wouldn't have started the short sale. In general though a short sale means you pay less than the current owner owes, it doesn't mean you pay a significant amount less than it is worth. If they will have the burden of it not selling at auction and having to hold it through a redemption period you have some room to negotiate.
Even paying appraised value there is room to make money. Most appraisers discount heavily for damage. If you are a rehabber presumably you do the work yourself or have connections that allow you to pay less than retail for repairs.