Home Buying in 01906>Question Details

Jjej54, Home Buyer in 01906

Buying HUD home and offer was accepted in Oct 2011 and still not closed. Is this normal?

Asked by Jjej54, 01906 Thu Feb 16, 2012

Pain for 3 extensions to the bank. All paperwork done, inspections, contracors done. Now they are saying they want 600.00 to have another inspection on a retainine wall that is on the property. Seems like I just keep dishing out money? Is this normal .?

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Your answer puts it all together! How about the payment for the extensions since it is taking so long. Is that money I won't get back once I close? We have paid over 1,000 because the bank keeps asking for additional things to be done.
0 votes Thank Flag Link Sat Feb 18, 2012
What bank is handling your rehab loan and is it a 203K?
0 votes Thank Flag Link Fri Feb 17, 2012
The reason you're getting this issue is because you're using a rehab loan, you're requesting additional funding to repair the property and the lender and/or HUD is seeking clarification on the issue. This is normal when requesting funds to repair/upgrade a property. If this was a standard sale the homeowner would have their own people give them an estimate for the work requested or $ off the asking price. In the case of bank owned/HUD/Foreclosed properties these expenses are passed on to the buyer rather than the bank/lender/HUD as a cost to the buyer rather than them due to you making it an issue. Your real estate professional (I always use this term rather than agent/broker/Realtor) could have or should have counseled you on this. Your attorney can also clarify this with you if you contracted your own buyers attorney to assist you with your purchase. Your purchase and sales agreement and/or offer guidelines will contain language that addresses this issue, if not your attorney would be the contact person to investigate and legally address this item.

This is a further example where properly understanding all the contractual details of an offer/purchase and sales agreement need to be fully examined and comprehended. The lender is under no obligation to pay for this expense, it's you who is seeking their funds to purchase an improve the property and HUD is not going to involve themselves with improvments/repairs/upgrades to sell a property. This is why I said to review all the documents provided to you prior to offer to see if any mention is made of this, but at the end of the day it's just an expense that will get passed on to you as the buyer of a foreclosed/HUD property. Hopefully you can overcome/accept this expense and enjoy your new home.
0 votes Thank Flag Link Fri Feb 17, 2012
The lender is asking for this re-inspection be done and we pay the 600.00 for it and yes there is a rehab loan involved. The contractor has come out several times for additional paperwork needed, gave the itemized items and cost from our home inspection that needed to be done. as requested by the lender. The person from the lender confirmed all the paperwork was completed and we would get the closing date in a few days and now this new thing came up. What place does the real estate person have at this point.
We seem to be getting the run around from the person we are dealing with at the bank.
0 votes Thank Flag Link Fri Feb 17, 2012
I have been involved with a HUD transaction that also took a LONG time due to an issue with HUD not being able to close because of some sort of budget discrepancy and they had not renewed their contracts with the law offices they use to handle their closings. This sounds like a different issue though, is it HUD requesting the $600 from you or your lender requesting you to do the additional inspection of the retaining wall? Are you doing a 203k Loan? Let me know the answers to these 2 questions and I may be able to help you further.
0 votes Thank Flag Link Thu Feb 16, 2012
Well first question would be do you have a buyers agent and attorney? If so what are they saying and with the current property is this to be expected? Was there a negotiation item brought up as a result that would make them question the retaining wall, it's costs/expenses as it pertains to the accepted price or negotiated price? Hopefully the "team" of professionals you're working with can best answer to the specific property but at times some unexpected expenses may come up and you would have 3 choices, accept, reject and walk away and negotiate some sort of expense sharing but HUD may not go for it.

One of the reasons the HUD properties are priced so attractively is that items like this can come up, the property may need repairs/upgrades etc. You should refrence the disclosure documents that were produced by the HUD inspection of the property prior to marketing, your own home inspection and any issues that your appraisal might have brought up. That might be where the issue is and more investigation could be done with you home inspection and the appraisal report.

Hope that helps,
0 votes Thank Flag Link Thu Feb 16, 2012
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