Homepath First Look: Fannie Mae

Home Path First Look Fannie Mae Todd: Hello and welcome to Todd Miller TV. I am joined here with the Fannie Mae listing agent Oana Sterlacci. Oana, thank you for being here.

Oana: Thank you for having me. Todd: So I wanted to have something called first look. It is a Fannie Mae program and a lot of investors are coming out with cash and buying all these properties and a lot of people who just want to be homeowners maybe get a low and maybe their offer is not as competitive because they are not just going to throw it on cash and close in 20 days so tell me about how Fannie Mae has sort of what policy they have in place to help promote homeownership. Oana: Well first of all Fannie Mae is not the only entity that has a first look program. First look pertains to a program that says only owner occupants that means that it is going to be the person’s primary residence not a vacation home or second home but their primary residence. So a lot of institutional sellers are doing that.The idea behind first look is to promote home ownership to stabilize neighborhoods, by putting homeowners in their and not having at the investments because the thought is that if you put a homeowner in a home the home will be better cared for and it will stabilize a neighborhood rather than an investment property.Fanni Mae has the longest first look property of any institutional seller. Some sellers have a 7 day some have a 10 day, some have a 15 day. Fanni Mae has a 30-day first look policy.Todd: But that is just here in Nevada though right? Oana: That is just here in Nevada.Todd: Everywhere else it is 15. Oana: So you know so you make a really good point through the nation the Fannie first look policy is 15 days in Nevada. Senator Harry Reid along with NHORA, which is the National Hispanic Organization, they pushed for a 30-day first look because they felt that would give homeowners a better chance at getting these properties and it would help stabilize prices, neighborhoods and that sort of thing.Todd: How did they know, what if a homeowner just has cash and they want to buy, how does, how do they know that they are not owner occupant, how does that work?Oana: Well what the institutional sellers do is they do several different things, one, they actually sent somebody out to visit the property periodically somewhere between 60 and 90 days and that can go on for several months. The other way that they research it is through utilities. They actually verify whose name and utilities are. Another way that they do that is to the post office. Who is getting mail at that address?Todd: Okay, up front though in the very beginning of the process that how do they know— how do they know that you know if there is a 30-day period with no investors how do they know if somebody just submits an offer?Oana: Okay.Todd: How do they know it is an investor? Oana: Okay two different ways. One during the first look period if it is an owner occupied then they have to sign a certification that says that under penalty of perjury they are certifying this will be their primary residence. The second way that they do that is they actually put that burden on the listing agent and we actually have to research the perspective buyer and we do that through several ways.One of the basic ways that we do has the tax record. We search to see if they own other properties in the area.Todd: What if their name is John Smith?Oana: You know if they have a common name like that clearly there is not much a listing agent can do. We are going to have to rely on their certification that they will be the primary person living in the house.Todd: So if their name is Zebignew Brezinski and you find that they have 18 other houses in their name and they give you a letter saying they want, they are going to be an owner occupant but it is in the neighborhood. They already own 5 houses and this is you know $40,000 house. They are paying cash for and I mean, how do they contribute if they just try to self certify an owner occupant? Oana: Right. You know, remember on the listing agent I am not the seller so it is my job to provide all that information to the seller and it is the seller decision how the truth proceeds.Todd: So Fanni Mae has got a policy in place. It is probably not anything is 100% effective but it does at least allow owner occupants per shot. Do you see on Fanni Mae properties in the first 30 days that they tend to not sell right away because there aren’t that many owner occupants? Oana: Yes.Todd: On day 31 all of a sudden offer is on there how does that usually work? Oana: It absolutely does. You know we have a lot of agents who would call and say, “Hey how many days are left in first look and when should I submit my offer, because what happens is if I have an investor who submits an offer during the first 30 days then I have to present that offer and that offer is summarily rejected and then that buyer is encouraged to resubmit the offer after 30 days.Todd: Is there an online resource that they are looking at the house and find out it is a Fanni Mae, they can figure out how much is left in first look? Oana: Absolutely, they have the same resource that all the listing agents have. This is not a private or secret thing. You go to homepath.com and you put in the property address and then like in the middle of the page usually in red it will tell you how many days left in first look. If it doesn’t say anywhere on that page, anything about days left in first look then that property is not a first look and it is eligible for investor purchase.Todd: Good. Alright, well thank you very much.Oana: You are welcome.Todd: That was the update for today, I hope you found it informative and I will look forward to seeing you on the next show. Thanks.