Freddie Mac offer To Ask or NOT to Ask For Repairs?

[James Ybarra]

I made an offer on a Freddie Mac home for a buyer.  List is 72900, offer was 67000 w/ 3000 in buyers closing costs and 3000 in repairs.

Listing agent told me they would reject it as written, asking for repairs.  He suggests I write it up 3000 lower and take a chance that they will repair after appraiser calls for lender repairs.  I am concerned about the possibility of my buyer losing the appraisal fee if Fmac says no to repairs.

What should I do?

 

Thanks,

 

James Ybarra

 

[Justin Kim]

My recent deal with Freddie made lender required repairs, in my case issues in the attic, broken plumbing fixture under the sink, and septic pump.

[Marie Walton]

Dear James,

Your first problem is with the closing cost. Normally Freddie will only pay 3% in closing cost and your $3000 is over that figure. Starting tomorrow Freddie is running a sales promotion that will allow them to pay 3.5% for closing cost but that's still a problem for you.

I sell a lot of properties for Freddie and I have never seen them allow repair costs in an accepted contract.

I assume that your buyers are owner-occupants and at this price level are going for a FHA loan. If the repair items are things a FHA appraiser would nornally call out such as broken windows, bad roof, no stove, etc., Freddie probably already knows, or should have known about this and will probably counter your offer telling you that your clients will need to get some type of rehab loan. 203K or a FHA that will allow them to roll the $3,000 into their loan.

If it's something like the clients just want new carpet or painting the lavender bedroom you can pretty well forget it.