I recently escalated a Seterus loan w/Fannie Mae that I have been working for the last few months.  When we listed it the home was priced according to the market and received a contract for $330K.  A few months later we hadn't heard anything so I escalated to FM because the BPO was never done.  When all came back the valuation came back at $360K.  The $360K value is what regular sales in great condition are selling for with upgrades.  So I contacted FM to dispute the value and find out what needed to be done.  I sent them a whole bunch of information including a home inspection report (Home needs some repairs, as it hasn't been maintained well and carpet and paint) and the HVAC is on its last leg and dishwasher is broken.    Well 2 weeks later I received a message from the FM person handling the file and now she says the value is $375K.  How is that possible?  Not a single home has sold in that neighborhood for that price.  There are homes Active and under contract but not SOLD. 

 

So does anyone have any recommendations as to what to be done.  At this rate the home will go into foreclosure.  Also at the new value, the 1st trust would no longer be a short sale and then the 2nd Trust Green Tree (Who has been a big problem in itself) doesn't have to follow any Fannie Mae short sale rules.

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Hi Stacy, There are plenty of discussions about this on this site.  Basically what's worked for me (many times) is having the buyer get their own appraisal and then submitting to Fannie directly, NOT to Seterus.

Checking in, has anyone seen success disputing inflated values through the homepath short sale site? If so, how long did it take for FM to give a reply

Hi Wendy,

Did you have to wait until the BPO expired (90 days) or can the buyer send in their own appraisal right away?

Thanks,

Jennifer

Hi Jennifer, I did not wait until the BPO expired, I sent in the buyer's appraisal right away.  Sent it to my contact after I filed a dispute.  Took 10 days for Fannie to agree to the appraisal price.

Jennifer-
Did they accept the disputed value
With the appraisal ? Did they actually reply within 10 days like they said they
Would ?

Courtney,

No they came back with their same exaggerated value. Seterus said to relist at this price or DIL is the only other option.

Stacy, I'm having the same problem with Fannie and would love to know if you are able to resolve this.  Thanks.  Paula

After all of this, Fannie Mae foreclosed on the property on Friday.  Interesting how they never provided any notice to me during the back and forth and through this week about the foreclosure sale date that was pending.  My sellers are trying to get it rescinded today at the courthouse for lack of notice but we shall see. 

Stacy..I completely sympathize with your dilemma..I also have a F/Mae sale with Suntrust who informed me a week ago of their counter offer - that the price had to be $191,000..our listing since June has been $179k-commensurate to other sales in the neighborhood..I met the Fannie Appraiser last August and he confirmed our numbers are realistic.

Having to face the challenge of this counter offer ($191K) I escalated and last week Fannie advised their value is now...$230k! Absolutely no way this home would bring that figure.

We've dealt with this before with Fannie...We suggest that an appraisal is ordered (split btwn Buyer and Seller) to defeat Fannie's unrealistic value. This is such a common theme across the country that someone in DC should be investigating this practice..Oh wait, thats right they closed  their doors...

Sorry Stacy, I dont mean to belittle your problem but its becoming endemic across the country.

Seth

Fannie is doing the same thing to me.    Servicer is Chase.       There first counter on EQ was 180k.  buyer came up to $10k on offer price (140k) and then fannie countered at 185k.   I asked negotiator what he made of this and he said they are just being very aggressive. Sometimes they can see that the market is changing and going up.

He had told me at one point the buyers needed to be closer to a value of $160-165k.  Then this week told me buyers might be good if they came up to low 150's.      Negotiator said Fannie does not give them a minimum net...that he just has to submit it to them and see what happens.  Not sure if Im buying that.

Oh and to top it off we knew the BPO agent and we KNOW the value did NOT come in at $180k.   So Im on a mission to figure out what Fannie is doing and there tactics in countering.

With FNMA, the "processor" (since they don't bother with the farce of a real negotiator these days) doesn't know what FNMA will do with the BPO. Multiple times, I have confirmed FNMA bumping the price around 20% above BPO. You are correct. Persistence can be very helpful, ask for a value dispute form, send them solid comps, explain details like they are in the 3rd grade, like comp A has a finished basement worth $5K more in this market, etc. The clearer you are, the less brain damage they have to deal with and the more likely you will make your point.

My broker has had good luck with their website dispute stuff, others out there have not, so I can't say I have much confidence in doing everything "their" way.

Call FNMA, etc. Basically, make it clear with your solid numbers and your persistence that you ain't going away just 'cause they wish it so.  The more solid angles you can come at them with, the better, like it has been on the market at $150K for 6 mo and only 1 offer at $140K, you think everyone out there can read ads and doesn't know this is a steal because it is really worth $180k? Hello?

They can be very obtuse/stubborn. [I had a property starting at $300K down to $240K w only 2 offers around $200K over 16 months and the idiots stand by it being worth $360K (down from a $400k appraisal!) - reality is NOT a requirement for these people.]

If you are, indeed, stubborn and getting nowhere, get the attention of a state senator with your story and have him chat with them. Agents seem to have a good amount of luck with that.

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