Posted on: 10th Mar, 2010 12:33 pm
This is one of those situations where I've done it before, I just can't remember how I did it and how it works.
I'm a loan officer, my client has just made an offer to buy a HUD REO with a $5,000 escrow for repairs. The initial bid/offer was made as cash or conventional, but review of the FHA appraisal done by HUD leads me to the feeling that conventional might not fly with the necessary repairs.
They bid $172,000, the escrow is for $5,000. I think we're going to have to go FHA to really make it fly. So I think I set the purchase price/loan amount at $177,000? Even though the contract is $172,000?
I'm sure there's one expert out there that has done many of these. I've only done 2 I think. One we went conventional and arrangements were made for repairs to be done on the sly.
It's a great program, like a mini 203k without all the extra costs and B.S.
Feedback appreciated.
I'm a loan officer, my client has just made an offer to buy a HUD REO with a $5,000 escrow for repairs. The initial bid/offer was made as cash or conventional, but review of the FHA appraisal done by HUD leads me to the feeling that conventional might not fly with the necessary repairs.
They bid $172,000, the escrow is for $5,000. I think we're going to have to go FHA to really make it fly. So I think I set the purchase price/loan amount at $177,000? Even though the contract is $172,000?
I'm sure there's one expert out there that has done many of these. I've only done 2 I think. One we went conventional and arrangements were made for repairs to be done on the sly.
It's a great program, like a mini 203k without all the extra costs and B.S.
Feedback appreciated.
Hi Howard,
I believe an FHA loan would be the way to go for in this situation. You should be able to finance $5000 for repairs along with the purchase of the home. It will be just like an FHA 203k loan. However, a loan officer who has done this many a time before would be the right peson to tell you how the program works and how exactly you can do it.
I believe an FHA loan would be the way to go for in this situation. You should be able to finance $5000 for repairs along with the purchase of the home. It will be just like an FHA 203k loan. However, a loan officer who has done this many a time before would be the right peson to tell you how the program works and how exactly you can do it.