How does the First Look Program from FHA work?
This HUD NSP Policy Alert is intended for NSP1 and NSP2 grantees seeking guidance on using the Federal Housing Administration (FHA) First Look sales method to purchase FHA real estate-owned (REO) properties located in their designated areas. Grantees will have the opportunity to make a purchase offer on a property prior to it being made available to other entities. NSP grantees can purchase these properties at a 10% discount off of the appraised value. These instructions are intended to assist grantees in obtaining the necessary approval to purchase these properties. This policy alert was previously labeled as NSP Policy Alert Volume 8.
You can also go the following link from HUD for NSP's home page which contains a detailed pdf on the topic.
I think you are referencing the first look program from Fannie Mae?
Fannie Mae "REO" homes - that is, homes that Fannie Mae has acquired through foreclosure and is looking to resell - are offered for sale through local brokerages hired by Fannie Mae. The homes for sale are (eventually) also posted on Fannie Mae's REO website here:
http://www.homepath.com/ For the first 15 days that the home is marketed, only offers from owner occupants are considerered or accepted. After those 15 days, if no offer has been accepted, the field is open to corporations and investor-owners as well (those that do not plan to live in the home).
The initiative is designed to strengthen the communities disproportionately affected by foreclosure and to avoid complete exodus of owner-occupants in hard hit neighborhoods.
Fannie's own info is here: