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  #1  
Old 09-29-2011, 12:24 AM
65076507 65076507 is offline
 
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Default arms-length question.please help!

So I am doing my 12 month comp previous listing search and my MLS tax record shows a transfer recorded on 01/25/2011 for about 100,000 and the grantee is FNMA. There is no MLS listing of this transaction and the SDAT MAryland tax record states it was an arms-length transaction. I am confused on why this is arms-length. If there is no listing, where is the exposure??? would an auction explain it perhaps??? Never seen this and I need to explain this in the report. Are foreclosures typically arms-length??? Any thoughts? Thanks!
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Old 09-29-2011, 01:09 AM
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Laughing Heir Laughing Heir is offline
 
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Originally Posted by 65076507 View Post
So I am doing my 12 month comp previous listing search and my MLS tax record shows a transfer recorded on 01/25/2011 for about 100,000 and the grantee is FNMA. There is no MLS listing of this transaction and the SDAT MAryland tax record states it was an arms-length transaction. I am confused on why this is arms-length. If there is no listing, where is the exposure??? would an auction explain it perhaps??? Never seen this and I need to explain this in the report. Are foreclosures typically arms-length??? Any thoughts? Thanks!
Deed-in-Lieu or sheriff sales are definitely not arm's length transfers. You really should take a look at the deed and draw your own conclusions from whatever data you can research. In Pennsylvania, you can get a pretty good idea about the nature of a transfer by viewing the deed; the deed will usually have a Statement of Value when it's NAL.

No matter what, you should call someone involved in the transaction to get the real story on what went down ... even on seemingly normal comps. The reviewers at my company usually want a sale verified with a Realtor AND the buyer and/or seller - they do this to ensure we find out the motivations of everyone involved.

Sounds like you will find out a lot about this prior transfer (and your current transfer) by getting your hands on the deed. If that fails use these sites to track down the grantor for that FNMA transfer:

www.whitepages.com
www.anywho.com

Best of luck!
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  #3  
Old 09-29-2011, 03:39 AM
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If the buyer is FNMA it's a foreclosure. It's that simple.
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  #4  
Old 09-29-2011, 08:18 AM
BOCK FOLKEN BOCK FOLKEN is offline
 
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Sounds like they just made a mistake. Happens all the time around here.
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  #5  
Old 09-29-2011, 08:21 AM
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Sounds like they just made a mistake. Happens all the time around here.

Huh? Who made a mistake. The prior homeowners that lost their house?
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Old 09-29-2011, 10:45 AM
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Terrel L. Shields Terrel L. Shields is online now
 
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"Arm's Length" is a misnomer and unless defined in your state by statute, the definition is a moving target.

Basically, it means the parties are "presumed to have equal bargaining power" (Blacks Law Dictionary). In that event this is a pretty broad blanket to throw over the transaction.

FNMA (Fannie mae) has "equal bargaining power" in theory. But they are motivated. So the question is whether a true "Market Value" transaction occurs or not when the seller is motivated by law to sell, is an unwilling owner, how long they exposed it on the market, and if that really matters, etc. well... damifino.

A buyer solicited offer may be an "arm's length" transaction. Both have equal buying power. The buyer may have cash and the seller free title and the deal could be consummated within hours literally. And by my way of thinking, so long as the buyer seller were equally motivated...it's "arm's length" but whether or not the transaction occurred at or above or below "Market Value", that's perhaps another question altogether.
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  #7  
Old 09-29-2011, 10:49 AM
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Jo Ann Meyer Stratton Jo Ann Meyer Stratton is offline
 
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When the Grantee is Fannie Mae it is a foreclosure and any dollar amount reported is the unpaid mortgage amount that went into foreclosure. Any time Fannie Mae, Freddie Mac, VA, HUD, a bank or a mortgage company, etc is the Grantee it is a foreclosure and not a sale.

An actual sale would be when one of the above is the Grantor.
  #8  
Old 09-29-2011, 10:43 PM
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Originally Posted by Jo Ann Meyer Stratton View Post
When the Grantee is Fannie Mae it is a foreclosure and any dollar amount reported is the unpaid mortgage amount that went into foreclosure. Any time Fannie Mae, Freddie Mac, VA, HUD, a bank or a mortgage company, etc is the Grantee it is a foreclosure and not a sale.

An actual sale would be when one of the above is the Grantor.
Thought I'd help a little...
  #9  
Old 09-30-2011, 12:13 AM
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Quote:
Originally Posted by 65076507 View Post
So I am doing my 12 month comp previous listing search and my MLS tax record shows a transfer recorded on 01/25/2011 for about 100,000 and the grantee is FNMA. There is no MLS listing of this transaction and the SDAT MAryland tax record states it was an arms-length transaction. I am confused on why this is arms-length. If there is no listing, where is the exposure??? would an auction explain it perhaps??? Never seen this and I need to explain this in the report. Are foreclosures typically arms-length??? Any thoughts? Thanks!
Why don't you just take a look at the deed? Especially since you can download the deed online through the Maryland digital land records retrieval system free of charge:

http://www.mdlandrec.net/msa/stagser.../cfm/index.cfm
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  #10  
Old 09-30-2011, 10:35 AM
BOCK FOLKEN BOCK FOLKEN is offline
 
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Originally Posted by residentialguy View Post

Huh? Who made a mistake. The prior homeowners that lost their house?
I am suggesting that either the MLS could make a reporting mistake, or the State could have easily made a recording mistake. It happens here all the time, and sometimes it takes an appraiser or homeowner to discover and correct it. Someone suggested checking the deed...a wise move.
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