All Forum Posts by: Andy Chu

I'll take a stab at this question. Owner occupied properties do not need to be at a discount. Here's the reason why. Properties are priced at a discount for a reason. The property has ugly colors, the roof needs to be replaced, etc, etc, etc. Any properties that need work will need a lot of hands on work. Are you going to be doing the work?

If you save on rent and can keep your primary job and not worry about projects around the house, you can focus on learning the trade and profitting from it.

I feel Will's observation is one sided. The wholesale business need not find the one investor that will take on the property. If they a slew of investors and the deal is slim but can make a profit for them, then its a win win. At any auction, everyone will think the winning bidder is a sucker.

Don't get discouraged if one investor turns you down. I may think the property is worth one number and the competition is worth another.

Wholesaling is unheard of...? WHAT?!?! I've taken down projects as a flipper and just don't have the crew or the capital or want to close on a property. I know there's equity, but I'm working on 3 other flips at the time. These are great to wholesale as I left enough meat on the bones for someone's time.

It is then a win win.

Moral of the story, don't get discouraged before you get started. Then you will not go in any direction. Best of luck.

Great meet up Phil and thanks for putting it together. It's a lot fun getting out there and meeting all the member and future members of BP.

This is the revised memo from Fannie Mae directly

FRAUD REVIEW: First Look™ Misrepresentations

Scenario
789 Elm Street, a Fannie Mae REO property, was listed on the market for only four days when the listing broker, Andrew, received an offer for this property. Andrew learned in corresponding with the buyer that she intended to use the property as a vacation home and not a primary residence; however, Andrew neglected to communicate this information to his Fannie Mae Sales Representative and allowed the buyer to submit the offer as an owner occupant. Motivated by his interest to close the deal without additional delays due to First Look™ restrictions, Andrew had the buyer sign the Owner Occupant Certification and indicated this in Section 4 of the Real Estate Purchase Addendum as well.

Analysis
This sequence of events represents a type of fraud categorized as "First Look Misrepresentations." Only owner occupants purchasing as a primary residence and buyers using public funds can purchase a property during the First Look Marketing Period, which corresponds to the first 15 days of listing in all states except Nevada (which has a 30 day Marketing Period). Investor offers may only be considered after the first 15 full days on the HomePath website, when the First Look™ countdown clock is no longer displayed. Fannie Mae defines a buyer purchasing a property for use as a second home as an investor and therefore, ineligible during the First Look™ marketing period. Brokers are responsible for accurately representing the buyer type and may be directed to question the buyer's motivation for occupying.

In the case described above, the listing broker was obligated to submit the offer as an investor offer, notify the buyer that the offer was rejected, and document this activity in the system. Once the First Look™ countdown clock no longer displays on Day 16, the broker should notify the buyer's agent to resubmit if the property is still available.

Resolution
Fannie Mae does not tolerate brokers or their agents participating in any sort of fraudulent behavior. Internal teams are dedicated to monitoring and investigating reports or evidence of suspicious activity. In the event it is uncovered that a Fannie Mae broker is a party to any such prohibited conduct, the broker may be subject to termination and the case may be reported to the agency responsible for investigating and prosecuting such cases.

ACTION!

Understanding First Look™
Brokers are not only responsible for understanding and complying with the timelines and regulations of the First Look™ program, but also for supporting and communicating the "spirit" of the initiative. The First Look™ program continues to be an important contributor in the mission to stabilize neighborhoods. By allowing this period for owner occupants, some non profits, as well as public entities and their partners to submit offers and purchase properties without competition from investors, Fannie Mae encourages home ownership and helps to build stronger communities.

To learn more about the First Look™ program, please review the REO Sales Guide and training materials available on the HomePath resources page. If you have any questions, contact your Fannie Mae Sales Representative or Asset Manager.

Contact Fannie Mae
Suspected REO fraud must be reported to Fannie Mae immediately. It is your responsibility as a broker or agent of Fannie Mae to report suspected REO fraud. Following are two avenues for reporting:
1. Phone Fannie Mae at 1-800-7FANNIE (1-800-732-6643)
2. Report the information via e-mail: [email protected]
For more information, additional resources are also available Fannie Mae's Mortgage Fraud Resources page. To navigate to the page yourself, visit www.efanniemae.com and click on "Preventing Mortgage Fraud" in the bottom right hand corner of the web page.
In addition to reporting the suspected fraud to Fannie Mae, we encourage you to report the information to your local real estate board or state licensing authority. Your assistance in fighting REO fraud is greatly appreciated.

I'm going to disagree with Callum on this one. There are two main components to property management. The first of which is keeping the property in good condition (which the contractor can do). The second is to collect rents and if the tenant does not pay, the PM evicts them immediately (which the contractor is not a professional at doing). Craigslist is a great source to put feelers out there, but how do you qualify a good tenants? Oftentimes, a credit check and background check is not a good indication of their financial abilities or willingness to pay on a monthly basis and maintain it well.

Keep these factors in mind and always interview more than a few PM as there are different qualities of managers. One last thing, price has nothing to do with the quality of managers .

Good luck.

We list on there commercial listings such as 12 unit complex, vacant restaurants, and etc.

Another website that we list on is propertyline.com

oh I love them. I just fought with a SS lender for two weeks because they refused to pay for title insurance. We nicely explained that for them to convey clear title, they need to provide it. NOPE, they rejected the HUD the second, third, and fourth time...

CPAs are great to talk to PRIOR to the year end. I would recommend actively talking to them now and allowing them to be familiar with your business. Anything after Dec 31, 2012 because number crunching and allowable deductions.

At this time, you can still have changes in the following, structuring any final deals, write offs, needed acquisitions, and etc.

Could you be more specific in what type of lawyer are you looking for? HOA Litigation? Contract? Probate? BK? Divorce? Trust? Business? The list goes on and on.