Insane Bank Practices
We have all seen the insane consequences of decisions made in DC that don’t make a bit of sense on the street. Same applies to Fannie Mae owned properties that require insane restrictions that are sure to drive any buyer and investor crazy.
Allow me to explain. We offered San Jose REO property an offer. After waiting 2 week, Fannie Mae finally accepted our CASH offer. But our celebration was short lived. The counter was filled with crazy and insane restrictions. They were simply hostile and buyer unfriendly as if the bank had no interest in selling the home that had stayed on the market for more than 168 days due to extensive need for repairs.
Here is the detail of the counter and the restrictions:
- Restriction 1: 120% cap on resale price of this home.
- Restriction 2: No Resale allowed prior to 90 days.
- Restriction 3: All inspection to be completed in 5 days.
- Restriction 4: Deal had to be ALL cash.
- Restriction 5: Deal had to close by 6/29/2011.
- Restriction 6: Earnest Money Deposit has to be Cash or Cashier check and be non-refundable after contingency removals.
- Restriction 7: Sale price no contingent on any appraisal.
Given these insane restrictions and our inability to get an exception, our investor had no choice but to cancel the purchase agreement.
But this cancellation prevented the employment of at least 5 different trades (Plumbing, Electrical, Painter, Roofer, Designers) along with a minimum of $50,000 which would have helped our local economy.
We could understand Fannie Mae’s hostile business practice if this was a Short Sale where your Asset Manager was concerned about getting the highest dollar possible for this asset. But this is an REO which has been on the market for 167 days. We could understand Fannie Mae’s hostile attitude towards investors if your Asset Manager did not have enough time to market this property.
So, we have started wondering if Fannie Mae’s is using our tax dollars to kill not help the housing recovery in Silicon Valley economy.