My USDA Loan is with an Underwriter now, but while researching some information online, I find this information that I thought was interesting. I am looking to put an offer on a REO property that is listed by an Agency - it's a condo and in very good condition - it's a condo that was foreclosed on. What I found was that, even if other offers are put in the same time as mine, unless they are USDA Guaranteed or Direct Loan applicants, my offer gets submitted first - even ahead of cash offers. It's a lot of information, but I found it here: http://www.rurdev.usda.gov/SupportDocuments/3550-1chapter16.pdf and will cut and paste it below as it may be useful information for others.
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C. Receiving and Considering Offers
Each offer must be date stamped when it is received. When a property is first offered for
sale, all offers received during the first 4 business days after the effective date will be considered
as if they were received on the same day. Any offer on a program property from other than a
program applicant during the 60-day reservation period will be held and considered received on
the 61st day.
______________________________________________________________________________
HB-1-3550
Paragraph 16.7 Regular Sale Method
Offers received on the same business day are selected in the following order.
1. An offer from an eligible Direct or Guaranteed SFH loan-applicant with a request for
credit on program terms. All program offers are evaluated as if they were submitted
at the listed price, regardless of the offering price.
2. An offer from a nonprofit or public body for conversion to use as transitional
housing, multifamily housing, or for other special purposes as specified in 7CFR Part
3550, Section 3550.251(d).
3. A cash offer, from the highest to the lowest.
4. A nonprogram credit offer, from the highest to the lowest. An offer with a request for
credit in excess of the market value of the property is not acceptable. If an excessive
amount of credit is requested, the offeror will be given the opportunity to reduce the
credit request to an amount equivalent to or lower than the market value less any
required down payment. However, no change is made in the offered price.
The acceptable offer from like offers of equal priority received on the same business day
are selected by lot. When selection is by lot, offers drawn after the first are held as back-up and
the offeror so notified.
The Agency selects the first minimum acceptable offer received and executes Form RD
1955-45. Form 1955-45 is sent to the bidder along with Handbook Letter 10(3550), ‘Status of
Offer to Buy Single Family Housing REO Property,’ and Handbook Letter 10(3550) is sent to
the bidder’s broker. Handbook Letter 10(3550) also is used to notify all unsuccessful bidders of
the status of their offers.
I also thought that this information below is useful to know:
16-5
(01-23-03) SPECIAL PN
Exhibit 16-1
Sales Schedule for Single Family Housing REO Property
Program Property
DATES ACTION
Days 1-60 Available for sale exclusively to eligible Direct or Guaranteed SFH buyers for
100 percent of market value.
Days 61-90 Available for sale to anyone for 100 percent of market value.
Days 91-120 Available for sale exclusively to eligible Direct or Guaranteed SFH buyers for 90
percent of market value.
Days 121-150 Available for sale to anyone for 90 percent of market value.
Days 151-180 Available for sale exclusively to eligible Direct or Guaranteed SFH buyers for 80
percent of market value.
Days 181-210 Available for sale to anyone for 80 percent of market value.
Day 211 Submit REO file with documentation of marketing efforts to State
Office for further advice on sales incentives or to authorize sealed
bid/auction.
