Fannie Mae & Freddie Mac "First Look" owner occupied initiatives for Foreclosed listings
Fannie Mae and Freddie Mac both have "First Look" programs in place to encourage owner occupant purchases of their foreclosed properties as they come on the market. For the first 15 days that they are on the market owner occupant buyers in many cases have the opportunity to purchase without competition from investors. In the past owner occupants lost out to cash offers from investors. These two agencies feel that owner occupants help to stabilize neighborhoods. Owner occupants are also able to take advantage of an FHA loan program to buy a home and fix it up as part of the purchase just like and investor might. The FHA 203(k) Streamlined Rehab Mortgage allows a buyer to finance up to $35,000 in repairs as part of a purchase. In some cases this might result in instant equity for the new homeowner and gives the a home in much better condition. With out the competition form investors this gives owner occupied buyers a better chance of taking advantage of both the current lower interest rates and the values that are sometimes available on new REO listings. Buyers interested in this program should look for properties under their target price to allow for the cost of repairs as it will become part of their mmortgage. Funds are paid to the contractor after the work is completed. Care must be taken in choosing a lender well versed in doing the FHA 203(k) Streamlined Rehab Mortage. Abuyer should choose a loan officer and mortgage company able to process the mortgage in 30-45 days to get the REO seller to accept this type of mortgage. they also want to know the cost for repairs prior to making an offer.