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Old 06-26-2013, 07:16 AM
 
14 posts, read 41,915 times
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Hi - I have a signed contract with Fannie Mae for a $40K house. Inspections revealed that furnace is broken and house is cased in led plus multiple other things. In short: Repair fees per inspector come up to $35.9K.
Question: Has anyone ever re-negotiated successfully with FannieMae? If so, how did you go about it, and what is an reasonable amount to ask off? Did you have to set a new closing date?We really like the house! (Value of the house all fixed would be around $65K.
Please help! Thank you!!!!

Last edited by LindaMaier; 06-26-2013 at 07:19 AM.. Reason: added info
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Old 06-26-2013, 07:41 AM
 
Location: Mount Laurel
4,187 posts, read 11,864,768 times
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My experience with Fannie Mae is that they are AS IS. What you offer under contract is not negotiable and they refuse to make changes. If you don't like what came out of the inspection report and you have inspection contingencies, you can cancel it but not re-nogiate. What they will do is put it back in the market and have you have to re-submit.


$36K repair on a house $65K house is a major repair. You are better off buying a shell. It mean you are probably re-doing all bathroom and kitchen along plumbing, electric and possible structural. This is like a new build.
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Old 06-26-2013, 07:56 AM
 
14 posts, read 41,915 times
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Actually, the house is structurally completely sound. It's the lead, furnace, and new electrical & roof.
BTW - Fannie Mae contracts are "AS IS", however, they also have the clause in them that everything has to be in working order - including the furnace. The house was winterized and the broken furnace was only revealed after inspection. Thereby my question to anyone with experience in re-negotiating with Fannie Mae.

Last edited by LindaMaier; 06-26-2013 at 08:01 AM.. Reason: additional information
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Old 06-26-2013, 09:05 AM
 
4,567 posts, read 10,593,417 times
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Quote:
Originally Posted by LindaMaier View Post
Repair fees per inspector come up to $35.9K.
You did say he was an inspector? Not a contractor with an actual quote right?

What is a $35,900 fixes it job for you, who doesn't know how to do anything is a $5,000 job for a flipper who buys a used furnace and installs it himself, slaps on new paint, ignores or makes the electrical good enough and does the roof himself.

You can try and get Fannie to lower the price, due to inspection results, but expect a rejection. The house will likely sell to someone willing to do the work themselves, or just live in a cheap, but badly repaired house.
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Old 06-26-2013, 09:15 AM
 
Location: Mount Laurel
4,187 posts, read 11,864,768 times
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Yeah.. the lead would probably get covered up and become "lead safe" versus "lead free". I am surpised that a Fannie Mae addendum would include "everything in working order". They do everything to they can to do the minimal when it comes to their homes.
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Old 06-26-2013, 09:57 AM
 
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Most old houses have lead paint. Its reality.

Leadfree is for rich people who can afford to gut a house, replace all windows, etc or just build a new house.
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Old 06-26-2013, 12:52 PM
 
Location: Ocala, FL
6,392 posts, read 10,184,412 times
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OP,

It is cased in LED (Light Emitting Diodes) ? Wow, must be really bright in there.

On a serious note, as mentioned earlier, it is highly unlikely that Fannie Mae will re-negotiate the price. The homes are sold at a price based on an appraisal. The appraisals take into account for repairs that may be required by the new owner/buyer. I have yet to see a Fannie Mae home where they will pay for repairs.

Last edited by dontaskwhy; 06-26-2013 at 01:01 PM..
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Old 06-26-2013, 05:27 PM
 
Location: El Dorado Hills, CA
3,720 posts, read 9,952,247 times
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I've had a client with a similar issue. She tried to re-negotiate the price after the inspection, Fannie Mae said no and the contract was cancelled. Buyer put in another lower offer, which was ignored. After a few weeks with no offers, agent called and said we should submit a new offer at the lower price, with no inspection contingency (since it was already done) and a 3% deposit. We did, it was a major pain the a*, but it finally closed.

Fannie Mae is tough. The house better be worth it.
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Old 07-01-2013, 06:44 PM
 
4,000 posts, read 4,066,767 times
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I was just going to ask about FM houses. I put an offer in on one, and FM counter-offered with the original listing price. IOW, no compromise.

DO they compromise or do they only accept list price?
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Old 07-01-2013, 08:37 PM
 
496 posts, read 440,283 times
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From what I've read, a lot of the FM houses I have seen are pretty strictly priced. They aren't completely off the mark in their pricing, but I find them pretty high as the houses are usually very dirty and in need of many cosmetic repairs at least, and often need new HVAC systems due to them missing or in disrepair. Usually they have an initial price, and when the house doesn't have any offers they will lower it substantially. I saw one drop 7k after a few weeks, and another currently on the market dropped 10k after being for sale for about two months. Maybe try waiting and see if they will relist it lower, that is if there are no other offers being made currently.
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