Posted by Alex Gurevich, TX on November 02, 1998 at 21:50:24:
well, that wonderful process brings about interesting implications, that I was just a part of, when my L/O buyer went to get his financing.
The house was sold as a “fixer-upper” in “as is” condition. The buyer was supposed to fix it up before getting financing. Buyer did not do anything to the house which looked even worse than when I sold it to him.
1)the mtg co. sent regular appraiser who appraised it at $45K citing poor condition. (The contract sales price was $56K.)
2)Mtg broker said, I’ll use a different underwriter who’ll accept an in-desk review and sent another appraiser for a “driver-by” appraisal. The drive-by came in at $63K.
3)We happily closed.
Conclusion. As long as this program exists one can sell a house that potentially has foundation problems (which may need tens of thousands in work) and a buyer can get conventional financing with 3% down.
All so amazingly true as long as:
- buyer sees a benefit of buying a house in this condtion (let’s offer him $25% discount on the price; of course we’d pay no more than 50% of value for a house with cracked slab)
- buyer can qualify for a loan.
- appraiser does not need to go inside.
Never heard of this before but it’s there now. Let’s use it while it lasts !!