Dear Fannie Mae,
First, I want to thank you for taking the time to hear my concerns and also my heartfelt thanks to Helena who was genuinely helpful when she called on Friday. It was so refreshing to speak with someone who was sincere in her desire to identify an issue and see what can be done to modify systems in hopes of finding solutions. It was my intention to put this together on Monday but when I received an e-mail from the listing agent on Sunday that stated “I will try to call you on Monday/Tuesday to discuss as I put a very high value of keeping good relationships with other agents/brokers” I thought I would wait to see if he had anything additional to add to the communication. Since I have not heard from him there is nothing to add.
My concern is that after following all of the rules prescribed by Fannie Mae a very clean cash offer submitted by me for one of your assets was rejected and the property was sold for approximately 12% less to another buyer. The First Look time period had elapsed and from I was told by Helena our offer is not even showing up in your system as having been submitted.
As I told Helena, not only did this cause my client to not get the contract for this property, it took $2,061 directly out of my pocket and $7,700 +/- variable costs out of the pockets of all taxpayers. Then, add in the fact that the sale that did transpire was at an almost 12% discount to what a ready, willing and able buyer was willing to pay and you can see how that will affect future appraisals and property valuations in the development. So in fact the ramifications are felt by many, many people either directly or indirectly.
Now for the facts surrounding my concern;
I submitted an offer for this property, on behalf of my client in the amount of $67,500 on October 13th. Knowing that my client was an investor and we needed to wait for the 15 day First Look period we waited for the day before the expiration to submit our offer. That transcript of the offer transmittal is below;
10/13/2010 12:59:00 PM
I am please to submit the attached offer from my client for your REO listing. My client is an investor and it is my understanding the Seller will start consideration of these offers tomorrow so we wanted to ensure they had this one.
I will also fax a copy to you and if you need anything else from our end please let me know.
Later that day I received the following e-mail from the listing agent’s assistant;
10/13/2010 5:05:00 PM
We have multiple offers on this property and the seller has asked for your buyers highest and best offer. Please complete the attached form and return it to me before 12 noon on 10/15/2010. If your buyers offer remains unchanged, this form will be all I need. If your buyer wishes to make any changes to the offer, please forward that offer to me as well.
Please note, the website for this bank will be down for maintenance and we may not receive an answer to your clients offer until probably Tuesday. I just wanted to give you the heads up. Thanks.
At that point, my client and I discussed where things stood and on October 15th, prior to the “highest and best” deadline period we submitted an updated offer increasing the purchase price to $68,700 and below is a copy of our transmittal of that offer;
10/15/2010 11:41:00 AM
I am pleased to submit the attached highest and best offer from my client for your REO listing. My client has decided to increase his offer to $68,700 and the new offer is attached.
I will also fax a copy to you and if you need anything else from our end please let me know.
As I am used to getting fairly quick responses in these situations I made numerous calls to the listing agent, apologizing each time for being a pest, only to be told that as of now we do not have a response and they do not know what is going on. It was a full 17 days later that I received the following e-mail informing me that our offer had been rejected.
11/1/2010 10:53:00 AM
I’m sorry, but the seller has rejected your clients offer on this property. I am truly sorry for the delay in the response as I JUST HEARD back from Fannie Mae today. Please feel free to check out our website for more bank owned properties that may suit your client. Thanks and good luck.
I didn’t really think about this further until November 29th when I received an update through our MLS system that the property had closed for $61,000. I immediately sent an e-mail to the listing agent for an explanation to which I received no response so the next day I sent a second request marked as such. Here is the transcript from my e-mail;
11/29/2010 5:03:00 PM
I see today where the property you had listed just closed for $61,000. You asked for highest and best offers for this property on October 13th to be returned before 12 noon on 10/15/2010. We submitted our clients highest and best offer in the amount of $68,700 well before the deadline. Will you please explain to me how the property closed for about 88% of the price my client offered for the property?
The second e-mail sent did garner the following response from the listing agent;
11/30/2010 12:44:00 PM
The seller (Fannie Mae) has a policy where they give owner occupants the first opportunity to purchase for a period of time before they open it up to investors which I believe we conveyed to you earlier. We are also required to submit the investor offers to Fannie during the owner occupant only timeframes so they are aware of all offers and activity which we did.
With this knowledge, Fannie elected to accept the lower offer that was owner occupied before we got to the investor period offer acceptance timeframe. The offer that was accepted was written by another agent/broker outside of this office. This is a policy decision that we have no control of. Hope this helps and thanks!
Since my understanding is that owner/occupants and investors are on equal ground after the 15 day First Look period this response did not make much sense and I have since spoken with Fannie Mae representatives who assure me this is in fact the case, Therefore, I again contacted the listing agent for additional information with this e-mail;
11/30/2010 1:22:00 PM
I appreciate your response and at least it will make for some fantastic blog fodder. My understanding of the Fannie Mae program is that upon expiration of the First Look period investor offers will be considered along with other offers. Since our offer was included in the “highest and best” request from your offer after the expiration of the First Look period I am still at a loss. Since Fannie Mae did not accept an offer until 11/1/10, a full 18 days after the expiration of the First Look period, it shows there is something wrong in the system and I will contact Fannie Mae to express my displeasure.
Thank you again for your assistance.
Seventeen minutes later I received the following response which to me was certainly not acceptable. I would think if there was something wrong with a transaction that I was the listing agent on I too would want to know what went wrong but evidently this wasn’t the case.
We gave you an explanation below:
That is when I made my initial call to Fannie Mae which prompted the return call from Helena last Friday. During that call I was told that there was no record of my clients offer in your system and that the offer that did close was accepted on October 20th. Since I was now a little more than curious I sent the following e-mail to the listing agent for further explanation.
12/3/2010 12:08:00 PM
I have spoken in detail with Fannie Mae about this asset and from those conversations I have been told the following;
1)An investor and owner/occupant are on equal ground when evaluating the offer after the 15 day First Look period has expired.
2) They have no record in their system of the highest and best offer I submitted on behalf of my client within the deadline period. Again, our offer was well above the accepted offer.
Once again I ask for an explanation of how the property closed for about 88% of the price my client offered for the property? As a professional courtesy I am requesting this information before deciding how to proceed with a potential formal complaint.
To this I received the following response that included a message from the asset manager you evidently out sourced this asset through;
12/4/2010 2:32:00 PM
This is from the asset manager from the Fannie Mae out-sourced company on this transaction below. I can tell you that I run a very ethical shop and I have this file documented to support what I am saying as well as what D.R. is saying.
All offers were in the system and presented to Fannie Mae. If Tom Priester has spoken to Fannie Mae then I would leave it at that. If Fannie Mae contacts me then I will review with them. The file is document and I clearly show your offer uploaded.
Now I have totally different information from the listing agent and Fannie Mae which troubles me even more that there is something wrong in the system. I responded to the listing agent late the same afternoon with the following missive;
12/4/2010 5:17:00 PM
I appreciate your feedback and am following up on this because something isn’t right with this. I know you are a busy man and will not bother you with future e-mails. All I know is I am tenacious and will have my say.
That e-mail prompted a response from the listing agent that for the first time seemed to say they were concerned that something in fact was not right and in fact the last communication I have on this file;
12/5/2010 9:59:00 AM
I will try to call you on Monday/Tuesday to discuss as I put a very high value of keeping good relationships with other agents/brokers. The last thing I need is for anyone to feel that they were not treated fairly and professionally as this affects future business.
Please keep in mind two things:
1). I have no control of the process in how the seller determines what offer they accept. We send in all offers including investor offers during the initial first look/owner occupant timeframe so the seller is aware of other offers. We are only the messenger between other agents and sellers and have no input on how or why offers are determined to be accepted.
2). As you can see by what agent/broker was involved with this sale on the selling side in the MLS, it was no one from my office, so I had no stake in this outcome financially. Actually, my office ended up making less money on the listing side for the transaction that closed versus for example your buyers offer, so logically I hope you can see that I had nothing to gain from the offer being accepted. I have to follow what the seller tells me to do and this is what I did.
I wanted to provide you all of the communication I have so you have the complete picture in hopes that you can get to the bottom of this matter and figure out what in fact did go wrong. While Helena informed me that I should not expect a response I did want to let you know that you have a very unhappy camper here in Jupiter. So much so I have purposely not show Fannie Mae properties listed by this agent over the past week and after explaining why to my clients they were not interested in viewing the properties. If there is not a reasonable expectation of getting a fair shot on being successful when playing by the rules it seems submitting any future offers through the same channels would be nothing more than a waste of my time, and that of my clients.
If you have any questions relating to this information, or would like any additional input from my end please feel free to contact me at your convenience. You will find me easy to reach at either on the phone at 561 308-0175 or via e-mail at firstname.lastname@example.org.
Thank you again for listening to my concerns and I am hopefully they can benefit Fannie Mae as we all continue to do our best to work through the foreclosure mess.