Just looking for any input on others experiencing the Fannie & Freddie inflated value issues. Any recent updates or solutions? 

I have two files right now that that I am experiencing this with, one is a Fannie and one is a Freddie. It is clear they have inflated the value on their end. It's not a BPO issue, its definitely an over inflated counter. In one case they countered more than 50% of what the actual BPO came back at. 

I have had my challenges with short sales over the past few years but there was always a reasonable solution or resolution, it's amazing what you learn to accept as reasonable. There doesn't seem to be a reasonable solution with these groups.

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I actually am in the process of speaking with IAR on this and hoping to put some efforts into communicating back to BPO agents that they can not take direction from lenders and servicers on their evaluation that would effect the number. It is an ethical issue and agents are being bullied into manipulating the values. The BPO agent needs to take a strong stance on this for now on and say, I will not change this. We as agents need to start sending a clear message ourselves to them and start filing ethics complaints against them. It's one thing to have an ethics guidelines but it's an entirely difference situation to enforce it. I don't want to put them in harms way but according to ethics, we as real estate professionals can not participate in providing a misleading value even if directed by the client whether that client is a seller, buyer, investor, lender or third party. Working for them doesn't mean taking orders. This includes leaving out REO's and Short Sales if they are driving the market which they still are in many of the markets I work. It maybe a losing battle in the end but these banks need to stop playing real estate. 

We have had an issue with a mortgage appraiser on the short sale I discussed previously. Before we paid for a full appraisal, which came back with $54,000, the buyers' mortgage bank came back with $85,000. Fix the house and we will mortgage it for this amount. 


It's a short sale. Who is going to fix the house to bring it up to its full value?


We are really in big trouble when both sides are in cahoots.

Oh my goodness!  Are you kidding me???

I would absolutely suggest that your seller speak to an attorney and contemplate filing charges.  Let us not forget that those people doing the BPO's are LICENSED Real Estate Agents.   If they do not want to stand up to these banks and do honest BPO's, they deserve to be fined and booted from our industry!

I believe that all of this is an attempt to stabilize housing however, until housing prices are in line with incomes I believe this will continue to be a problem and Fannie Mae's attempt at artificially inflating prices is only making the problem worse.

falsifying property value in any direction de-stabilizes the market and is illegal and always has been...

It is an attempt to create value where none exists to profit the not holder...it is fraud and felony and affects everyone negatively...whether the price is up or down makes no difference!

I love your statement!   I am sick and tired of us whining about what we can't do.  It is TIME we stood up as a whole and took a stand against this.  

Just got off phone with my seller's and their attorney - and they are proactively filing a claim with DRE against the BPO agent who has committing fraud.  YEAH.  I think it about time we step up and stop this!

The same thing is happening with their REO inventory.  Have several buyers that are dealing with the same inflated value issue.  In this case, one property is listed for $379,000, but the comps support values of $320,000 and $285,000.  Client offered $332,000 and FNMA countered at $370,000.  On top of it, one of the requirements is that the buyer use Homepath financing --- which we all know why!  At any rate, we will see if the price is reduced now that it is out of First Look.  I get that the values are inflated to attempt to bring the market around, but it is very frustrating. 

I am pretty sure they can not dictate what financing or type of financing buyers have to use. They may require them to submit the offer through Home Path but they can't force them to use their own financing. This may even be a RESPA violation.

They require the buyer to apply through them.  The buyer is not required to accept the loan terms and they are allowed to go elsewhere but after they have applied with Homepath first!

lol...either respa doesn't apply to them or they have probably exempted themselves from it.

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