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Thread: Fannie Mae

  1. #1
    Luc V. L.'s Avatar
    Luc V. L. is offline Member
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    Default Fannie Mae

    I have been performing full home inspections for a real estate agent representing Fannie Mae (the owner and seller of the home). He has expressed interest in having a summary in the report that is more tailored to the repairs that Fannie Mae will most likely make as opposed to the summary that I normally (buyer's inspection) use to summarize the significant issues of the home. We have had lengthy discussions about what he feels Fannie Mae is or isn't interested in repairing.
    I'll report on all conditions as usual, but only alter the summary so it is more helpful for the realtor's tasks at hand. In the General Info section at the top of my report, I have expressed explicitly that this is the nature of the summary and that the entire report must be considered to understand the condition of the home. All of my normal disclaimers are within the report as usual.
    I am a new inspector and this has been a steady stream of work and therefore valuable for my business. Couple of questions:

    1. Does anyone have some insight about this process or any experience in similar situations that could be helpful?
    2. Any resource where I could learn more about this Fannie Mae request for inspections on their foreclosed assets? I've been unable to gather good info from their website.
    3. Is this the most appropriate forum for this thread?
    -Thanks

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  2. #2
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    Default Re: Fannie Mae

    Quote Originally Posted by Luc Lamarche View Post
    I have been performing full home inspections for a real estate agent representing Fannie Mae (the owner and seller of the home). He has expressed interest in having a summary in the report that is more tailored to the repairs that Fannie Mae will most likely make as opposed to the summary that I normally (buyer's inspection) use to summarize the significant issues of the home. We have had lengthy discussions about what he feels Fannie Mae is or isn't interested in repairing.
    I'll report on all conditions as usual, but only alter the summary so it is more helpful for the realtor's tasks at hand. In the General Info section at the top of my report, I have expressed explicitly that this is the nature of the summary and that the entire report must be considered to understand the condition of the home. All of my normal disclaimers are within the report as usual.
    I am a new inspector and this has been a steady stream of work and therefore valuable for my business. Couple of questions:

    1. Does anyone have some insight about this process or any experience in similar situations that could be helpful?
    2. Any resource where I could learn more about this Fannie Mae request for inspections on their foreclosed assets? I've been unable to gather good info from their website.
    3. Is this the most appropriate forum for this thread?
    -Thanks

    Well for starters you are in a licensed state that has a required SOP for the inspection. Whatever you do you need to make sure that you are following the state SOP and not just what the agent wants.

    My experience with all REO's including Fannie Mae is that they will make the repairs necessary in order for it to sell, sometimes! If the sinks and toilets have been removed they will have new ones installed; if Holes are in walls they will patch them; if the roofs is leaking they will patch it; if the heat is not working they will get it working; etc, etc, etc...

    Paint, minor wood rot, drips at faucets, and minor issues they do not address.

    Scott Patterson, ACI
    Spring Hill, TN
    www.traceinspections.com

  3. #3
    Ted Menelly's Avatar
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    Default Re: Fannie Mae

    Quote Originally Posted by Scott Patterson View Post
    Well for starters you are in a licensed state that has a required SOP for the inspection. Whatever you do you need to make sure that you are following the state SOP and not just what the agent wants.

    My experience with all REO's including Fannie Mae is that they will make the repairs necessary in order for it to sell, sometimes! If the sinks and toilets have been removed they will have new ones installed; if Holes are in walls they will patch them; if the roofs is leaking they will patch it; if the heat is not working they will get it working; etc, etc, etc...

    Paint, minor wood rot, drips at faucets, and minor issues they do not address.
    I don't know how well this Realtor knows you but if he does not or does it sounds to me that he wants you to tailor the report so it makes his life easy as in being able to brush everything else off stating to the clients that Fannie may won't fix the rest of the items.

    Anyone buying the home has the right to request that everything or nothing be fixed no matter what Fannie won't fix. You just need to explain it politely to the Realtor that the concerns found in the home go into the Summary....all the concerns. The clients have a tendency to skim over the reports for the most part and just read the summary.

    Concerns found...no matter who the mortgage company or Realtor go into the summary or nothing goes in the summary. Unless your state says you need a summary then you really do not have to give one. I do not supply a summary on most inspections because I want my clients to read the report. You start picking and choosing what does and what does not go into the summary and you just may be paying for a lot of items down the road....maybe even years down the road depending on your state. It will look like you are working for the Realtor and not the paying client.

    Last edited by Ted Menelly; 11-29-2010 at 06:20 PM.
    Ted Menelly, Castle Home Inspection Services
    www.inspectmycastle.com
    Fort Worth, Keller, Southlake, Plano, Flower Mound, DFW, TX

  4. #4
    Luc V. L.'s Avatar
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    Default Re: Fannie Mae

    The client is Fannie Mae. From my understanding, they are requiring home inspections for some of their foreclosed homes, not as lenders but as owners. Fannie Mae wants to find out what improvements they are willing to make before attempting to sell the home. The agent I am working for is hired by Fannie Mae. He does the leg work hiring contractors to fix the issues in the home based off the inspection report (like Scott Patterson was saying above). They had been using local general contractors to make the call on repairs but have recently been hiring licensed inspectors. A typical sellers inspection with a not typical client?

    At this point of the process, there is no buyer in the picture at all.

    The inspection and reporting process remains the same, making no changes in what is reported or deviating from the WA SOP, only employing a different summary criteria at the request of the client.

    Does anyone smell a funky situation at all or have bad/ good experience in this kind of inspection? Are there holes in my understanding of the transaction details? Is anyone else being hired by Fannie Mae in this capacity? Suggestions?

    Thanks.


  5. #5
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    Default Re: Fannie Mae

    Every defect in the body of my report goes into my summary. If it is worth mentioning in the body, it is worth going into the summary. There are no major or minor defects in my report, just defects. My state requires a summary but they exclude maintenance and upgrades from the summary section. There are no maintenance or upgrade items in my report. Only Safety or Repair Items.

    You have a business ethics question. Do I modify my report based on client requests or do I follow my standard business model? If your standard business model can be improved for all you clients, than make the change. If you are modifying the report to generate a different result than you would normally report, then you are a prostitiute who will do anything for the highest bidder and have very poor business ethics.

    I have several agents request I number the summary section to make it easier to discuss items in the summary section with the selling agent. Easy fix to my report formatting. Does not change what I include in the report, just a simple formatting change.

    Clients have asked that I not report a defect or to include a specific defect. I have told them I cannot leave out a defect due to state licensing and SOP. Explaining that what the client sees as a defect is not a defect by home inspection standards is a tougher sell. Ultimately it is my report and I decide what I report or don't.

    If it is a formatting change to make it easier to read or use the report, go for it. If it a request to "overlook" or "under report" defects, then you are compromising your personal standards and possibly not meeting the SOPs. In that case, they need to understand they hired a home inspector and not a lackey. Your name will be passed around the real estate offices as one who is a prostitute and will sell out for the right $$$.

    "The Code is not a peak to reach but a foundation to build from."

  6. #6
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    Default Re: Fannie Mae

    You can just about bet that if you issue a report on a property that it stands a good chance of being passed on to a prospective buyer. It might be the entire report but most likely just the summary if it looks better.

    I would not change anything in the way I report the findings in the report. The agent has not liability and you have it all!

    Scott Patterson, ACI
    Spring Hill, TN
    www.traceinspections.com

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