With all the competition out there on foreclosed property, I can see why the seller/bank would be discriminating against your FHA. Even thought you have 20% down! It's just crazy, but it's happening. Think about it...if they have a handful of offers to choose from, say 2 FHA and 3 CONV, all 20% down, the 2 FHA offers will be discarded, regardless of price, just because of the guidelines that FHA has on condition, etc. The CONV offers are just safer and less risky for the seller/bank. Typically speaking, you can change the terms of your financing in the middle of escrow so long as it doesn't effect the seller. I'm not familiar with contract law in your state, but I think you should be okay. This question is really for your agent and more importantly your lender. Also, make sure you take it upon yourself to really read and understand the financing portion of the purchase contract. Don't get yourself into a situation where you would be in danger of losing your earnest money. Best of luck to you.
â€œK. BUYER STATED FINANCING: Seller has relied on Buyerâ€™s representation of the type of financing specified (including but not limited to, as applicable, amount of down payment, contingent or non contingent loan, or all cash). If Buyer seeks alternate financing, (i) Seller has no obligation to cooperate with Buyerâ€™s efforts to obtain such financing, and (ii) Buyer shall also pursue the financing method specified in this Agreement. Buyerâ€™s failure to secure alternate financing does not excuse Buyer from the obligation to purchase the Property and close escrow as specified in this Agreement.â€
You may want to contact a Real Estate Lawyer if you have any questions about what this section in the contract means. Make sure your agent is aware of what the contract actually says as there are consequences if it does not work out.
Good Luck to you on your home search.
In most escrow these days you will have more problems with banks not funding their deals than FHA Government insured loans.
FHA will tell you from beginning if you qualify or not and if you're qualified than 90% you will actually close.
I can help you with that.
I work for coldwell banker in studio city and our loan officer can really help you.
As for changing to an FHA loan later once the offer is accepted, I do not see it being an issue.
Hope this helps.