help ASAP!! how to finance this deal? - Posted by nancy PA
Posted by nancy PA on July 12, 2003 at 22:51:46:
(sorry, I have it posted in the main news group too. I really need quick help!)
First of all, I want to thank those who took the time to reply to my previous postings. I got lots of good advice and information. Thank you very much! This is a great site with many great people!
I’m in a situation and is desperetely seeking for help!!
I’m helping my friend selling his property. This is a beautiful single home, 2 yr old, over 3200 sf living space, in Philadelphia city, sitting on a park… there’s no other home like it being sold in the area. It’s under contract for 529,000 with 2.5% seller assist on closing cost. (the buyer is an real esate agent, so we agreed to assist her the same amount as we would otherwise pay a buyer’s agent). she was going to morgage $400,000.
Now, the difficult part is doing an appraisor. Homes sold in the area are around $300-$400,000, one neighbor got his appraised during refinance for $527,000 (but his has more improvements),but they will not recognise this value in the comparable sale during an appraisor. So looks like we can get the most $500-$510,000 for the appraisal…Is there a way to finance it for $529,000 sale’s price without having to put up extra money from both seller and buyer? I’m looking for a more win-win solution. I don’t want the buyer to back out of the sale. she wants to put down at least 20% in the home to avoid PMI and she also wants seller assist to reduce closing cost.
The buyer doesn’t want to put up more cash to morgage the lower appraised value and pay be the difference. (I don’t know why would the morgage company not morgage a home that’s a little over priced if the buyer is putting down 20% of the higer sales price)
I’m thinking of reducing the sales price to reflect the appraised price, then reduce the amount of seller assist according, but I don’t know if the buyer will agree since she’ll have to put up more cash for closing.
Is there a way to have her finance say 500,000 and the seller finance the rest? but I don’t know what kind of term it should be on. I need to protect my friend’s interest.
I need to think of a good solution early next week.
Any advise is greatly appreciated!