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Contingencies on a Fannie Mae HomePath House - Do I Need a Lawyer?

I will be submitting my first offer tomorrow for a Fannie Mae HomePath property. I only have 2 VERY important contingencies. After talking to my agent has his very best to assure me that it will be included in the offer (Fannie Mae Addendum and Realtor purchase contract) but I still feel extremely uneasy because it's my first time. I am NOT requiring anything else, no closing cost contribution, etc.

I ABSOLUTELY want to make sure the 2 contingencies are clear in my offer:

1- If something comes up in the inspection I don't like, including expensive repairs or foundation issues etc., I can simply walk away and not be entered into a binding contract. (MOST important)

2- Although I have a pre-approval letter attached to offer, being approved for the actual loan is another contingency. This does not seem to be an issue.

I read the Fannie Mae addendum completely, and I understood that their addendum supersedes all other contracts. I want to make sure my agent makes my contingencies very very clear while submitting the offer. What should I do?
  • April 20 2013 - US
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Answers (4)

Beware! Fannie Mae now has a policy of keeping earnest money! My client was granted many extensions and in the end was unable to obtain financing. We provided the denial of credit 4 days prior to the final amended close of escrow date. So we were within the loan contingency period right? Wrong! Fannie Mae told the title company since the original seller's addendum had the original closing date, that is the loan contingency date they are using. The title company is scared to cross Fannie Mae. The asset managers simply don't respond, the title company is scared to make a judgement. I for one will not be showing any more Fannie Mae properties and if buyer's insist I will let them know of Fannie Mae's new policy.
  • March 05
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You'll be fine with the language that is already in the Fannie Mae contracts, but ensure you don't miss your dates because you'll lose your earnest money.  Good luck!
  • April 20 2013
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Congratulations on your upcoming purchase!

As Tim/Rachel pointed out, you have to use the Fannie Mae contract.  As long as the inspection/financing contingency is included, you should be good.  Just make certain you/your agent stay on top of the dates regarding those contingencies...miss a date and you won't see your earnest money again.

Good luck!  Happy inspections!
  • April 20 2013
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Profile picture for Outer Banks N C
You don't need a lawyer, what you need is a good agent with experience. You will have to deal with that Fannie contract and live with it OR Fannie will not accept your offer no matter if you have a lawyer or not. If you could raise Johnny Cochran from the dead to write it up Fannie would say NO to anything they don't like. You are never in the drivers seat with Fannie, they are. Fannie gives you an inspection period and it is a short one so move FAST with inspections and walk if you must.
  • April 20 2013
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