Fannie Mae Looking Move REO Inventory Quickly
Fannie Mae is stuck with a growing number of REO (real estate owned) houses. However, in a recent new policy announcement, the lending giant has made plans to expedite the process of buying an REO home. Fannie will now be accepting purchase offers immediately after the home is listed. Under Fannie Mae’s previous policy, they gave lenders fifteen days to find a better purchase offer for new REO houses they sent to the company following a foreclosure.
The old policy affected repossessions where Fannie Mae required the loan file on the house. This tended to expose errors in underwriting or servicing, and required reimbursement for losses by the lender. Because of this policy, it gummed up the works and REO sales were slow, even if willing and able buyers were available.
To combat the slowness of REO sales, Fannie Mae has simply proposed to make the sales process and acceptance of offers earlier. There will be no more fifteen day period of inactivity for lenders whose REO property has been selected for loan file reviews. As soon as a property is listed, it will be fair game to home buyers. If any loss is incurred, the lender will be stuck with the loss.
This new policy may offer some new opportunities for buyers and agents who are looking for some good deals.
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