If you are considering buying a foreclosed home you should be aware of the First Look Initiative on Fannie Mae, Freddie Mac and HUD foreclosed homes.
This plan was initiated in the fall of 2010 because buyers who planned to live in the homes they were purchasing were having a hard time competing with cash investors who were snatching them up before most people even knew they were available for sale.
The First Look program supports homebuyers who plan to occupy the home and help stabilize the community by eliminating competition from investors.
In most cases the first 15 days a foreclosed Fannie, Freddie or HUD property is on the market sales are restricted to owner occupant homebuyers or nonprofit Neighborhood Stabilization programs (NSP). If you purchase a home during the restricted time period you will be required to sign an affadavit confirming you will occupy the home as your primary residence within 60 days and will live there for at least one year. If you don't, you may be subject to a $10,000 fine.
No one who signs the purchase agreement during the restricted time period can own another property. That means if you have a co-signer who owns another property you won't qualify even if you are the primary buyer and you plan to live there.
While investors play an important role in the foreclosure market, owner occupants better help stabilize communities. It is the goal of the First Look Initiative to promote owner occupancy and homeowner involvement in their community.
Sharlene Hensrud, RE/MAX Results – Email – HomesMSP.com
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