Posted by Brent_IL on February 26, 2001 at 14:23:03:
She will have the cash when you write her the check for $38,000 that you are obligated to pay at closing.
Money back at closing? Will this work? - Posted by batpro
Posted by batpro on February 25, 2001 at 17:12:46:
Today I wrote a purchase agreement which the seller accepted.
The seller agreed to sell single family home for $33,900
I asked the seller if we could list the purchase price for $38,000 and then we wrote on the offer in the “other section” of the purchase agreement: At closing seller agrees to give buyer $4,100.00 for home improvements.
I have not yet talked to my mortgage broker since today is Sunday.
My question: Is this accepted on the secondary market?
If not, how can I get the $4,100 for house improvements (or cash in my pocket)?
The seller needs to pay off existing mortgages of $32,500.
Any help you could provide would greatly be appreciated.
Thank you,
BE CAREFUL!!! - Posted by Todd (MO)
Posted by Todd (MO) on February 26, 2001 at 19:40:59:
Yes! You can do it the way you have proposed, I do deals like this all the time.
However BE SURE TO INCLUDE IT AS PART OF THE CONTRACT and make sure the lender is aware of it. They will usually have not problem with it and will think it is smart to be thinking ahead, and an improved property better secures their position.
But include it in the contract and let the lender know about it. If you don’t it can be construde as defrauding a lender and that is a Federal crime. I have had several attorneys in different states tell me this. DO NOT HIDE IT FROM THEM AS SUGGESTED.
They will likely be cool with it.
Todd
Re: Money back at closing? Will this work? - Posted by Rocky
Posted by Rocky on February 26, 2001 at 18:26:56:
I buy properties like this all the time. I wouldn’t let your mortgage broker know about it though. I always write the cash back for needed repairs on a seperate addendum that only the seller, the RE agent and I know about.
Good Luck!
Rocky
Re: Money back at closing? Will this work? - Posted by Houserookie
Posted by Houserookie on February 25, 2001 at 23:53:28:
Why not have the seller PAY you to repair the property?
Is 4100 enough?
Have him give u a cashiers check. You do what u want with that money…including using it to purchase the property down payment.
Re: Yes and No. - Posted by TD
Posted by TD on February 26, 2001 at 21:31:38:
Ignore this troll.
If you don’t disclose to the lender, you’re potentially S.O.L if you get caught - why take the unnecessary risk, and worry about someone who is jealous of your success turning you in?
Re: Money back at closing? Will this work? - Posted by batpro
Posted by batpro on February 26, 2001 at 07:25:41:
Are you stating that she give me a check prior to closing? I don’t think she has the funds to do this. She just wants to pay off her existing mortgage and home improvement loan.
It does sound like a good idea though, maybe she could come up with a $1000 or something. I will check into it.
Any other suggestions out there?