DOES FANNIE MAE OWN THAT PROPERTY YOU WANT TO BUY?

The question presented today is very interesting. Can a buyer's agent get their commission if the property has been sold by them, but there is no trustee's deed on record conveying into Fannie Mae, AND, it is discovered that the foreclosure is defective?

CHARLENE PERRY's Blog ::

The listing agent called me today to ask my opinion as to whether or not a selling agent can demand that Fannie Mae pay them their commission.

The circumstances surrounding this case are that the seller, Fannie Mae, had this property listed by their local realtor. The property subsequently went to sale. The buyer acquired their loan and was prepared to proceed to closing on Monday, April 19, 2010.

Upon ratification of the contract of sale the seller's title agent, who we must remember is either owned by or operated by the foreclosure attorney, contacts the foreclosure attorney for their one owner title search and the trustee's deed into Fannie Mae.

At this point it is discovered that the report of sale in the foreclosure case has an error. The error being that they mis-reported the amount of the sale into Fannie Mae. I have been told, but have not confirmed, that the report of sale does name Fannie Mae as the purchaser at sale so the only error is that of the amount of the sale.

The buyer's agent has advised the listing agent that she intends to file suit because Fannie Mae had no right to list the property in the local MRIS system for sale because they were not the owners of record and thus could not enter into a listing agreement.

The foreclosure attorney has filed a motion with the court to amend the report of sale and to allow the order of ratification of sale to stand. The order has not yet been signed, and when signed, does that then mean that there is an additional time line that needs to be met to allow for exceptions to be filed? I'm just throwing that out there for thought.

So, does the selling agent have a point? I did some quick research in one county here in Maryland and found that of 5 properties that are showing by Fannie Mae as being "under contract" 4 of them are still vested in the prior owner, no trustee's deed having been recorded, despite the fact that in all of these cases the foreclosure ratified with the court some time ago. In fact in one case on the foreclosure cases ratified with the court in August, 2009.

I would appreciate your feed back.

Charlene

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	Sounds messy...
	I think there was enough sloppy work here to pass around a lot of blame. However, on the sole issue of whether the listing agent is entitled to a commission, I'd say yes. The only obligation of the listing agent is to procure a willing and able buyer for the property. I believe that at that point, the Realtor is entitled to the commission whether or not the sale actually transpires. Regarding the issue of whether the buyer's agent is entitled to conpensation, I'm not really sure. The buyer's agent was not a party to the listing agreement with Fannie Mae, so I think they would have a tough time enforcing it. The buyer's agent may have a right to demand payment from the listing agent, which would force the selling agent to demand the commission from Fannie Mae. I guess that depends on the contract, if any, between the listing agent and the buyer's agent. It is an interesting issue. But, I'm not really sure of the outcome.
	by Robert Franco \| 2010/04/14 \| log in or register to post a reply

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