Posted by Nate on February 21, 2001 at 13:19:45:
So basically he needs to come up with 5% of $80,000 – or $4,000 – somehow. Will the bank allow a second behind their 95% LTV first? If so, see if the seller will take a second for $4,000, meaning he is not out of pocket except for closing costs. Or, like your brother mentioned, offer $80,000 with a credit (could be for closing costs or repairs – doesn’t really need a reason as long as the seller agrees to it and the amount is within what the lender will allow), but beware, many conventional lenders limit the seller contribution to 3% of the selling price.
Maybe you should tell him to forget it and then find a better deal for him!