Home Buying in 55442>Question Details

Beth, Home Buyer in 55442

Last week we made an offer on a home that was accepting our FHA financing. The offer was accepted - cute nice older home. We had a private

Asked by Beth, 55442 Sat Sep 5, 2009

inspection. The inspector suggested some minor improvements. (less than $2,000 in estimation) Our realtor attempted to negotiate with the seller for the repairs, since FHA may call for them anyway. The seller said he would not do one little thing, was going to cancel the contract and put the house on the market conventional unless we agreed to fix any and all things the FHA inspector calls for out of our own pocket. We are willing to do the repairs ourself on items FHA calls for (up to a limit of course, if the cost exceeds $2,000 then we will have to cancel the deal ourselves). How do we get assurance we won't be out the money and protect ourselves if we do repairs and the seller abruptly decides to back out of the deal after repairs are done but before closing? #2 If the FHA calls for say electrical repair or painting or roofing - can we do this ourself or do we need licensed contractor? We are experienced with self repairs on our prior house (our work passed city inspection).

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Lots to answer, I would not get excited about FHA until you have the inspection. Then decide what to do.
That cancellation question came up before. They can not cancel the contract with out your approval(signature). They have to do a declaratory cancellation, Minnesota law, 15 day waiting period.. It appears most Realtors do not know about it. There is a risk in doing the repairs yourself. You are not the owner, permits would have to be taken out by the owner. Otherwise, you have to be a licensed contractor. Do a search of FHA repairs, the rules have changed, minor stuff is now passed on, paint for one. Between you and your Realtor you should be able to determine the roof condition. Do not let the seller intimidate you, call their bluff. Big problems will be problems for any conventional buyer. A little negotiation by your Realtor can go a long way. How old is the house? How long have they lived there?
0 votes Thank Flag Link Thu Sep 10, 2009
Seller can back out at anytime, many ways to work this benefit for all parties have your buyers agent discuss terms with you. Therefore protects seller and you Good luck

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0 votes Thank Flag Link Sun Sep 6, 2009
Beth, you are a great advocate for having a private inspection. Many people avoid this and find themselves in a quandry when they cannot close a transaction due to the problems you identify. If you feel this home is unusually idea for you, the advice provided here is good and may allow you to go forward. I think, as others suggest, you need to get back to your agent and his/her broker. It may be in your best interests to move on and find a home that will meet FHA criteria and your needs. If you do decided that course of action, the agent and broker will prepare the cancellation papers and get your earnest money back. Make sure it is all in writing. Liz 612-986-4105
0 votes Thank Flag Link Sat Sep 5, 2009
Beth,

You best course of action, if you are going to persue this property is to include the services of an attorney to protect your besr interest.

Good luck
The Eckler Team
0 votes Thank Flag Link Sat Sep 5, 2009
I agree with Susan in the regard that you really need to seek consultation from your agent, perhaps your agent's broker, if they are new and your attorney.
These are all people that you have hired to work for you and answering questions and concerns such as this is why you have them.
The very best of luck to you in your purchase!
0 votes Thank Flag Link Sat Sep 5, 2009
Frankly, if you are doing a straight up FHA, most likely this work that FHA might call would need to be done prior to closing. If it was just a few hundred dollars of work, I might advise that the gamble would be worth it. However, since you say the work may add up to a few thousand dollars, I would be hesitant to advise a buyer to put that much in to fixing these things with the knowledge that they do not yet own the home! There is always a risk that something would fall apart and you would be out the money. I might suggest you see if the seller would agree to reimburse you should the deal fall apart for any reason after the work has been done. That would all need to be in writing. Or, see if you might be able to do an FHA 203K loan. That would allow you to do those necessary things after the closing and you could build the money for the repairs in to your loan.

My question, why aren't you discussing these questions with your agent? That agent is your best adviser because they are as close to the deal as you are. Our advice in this forum is all very general because we do not know the particulars of your transaction.

And, I stress that I am not an attorney and do not dispense legal advice. If you feel strongly about your rights, please seek additional advice from an attorney.
0 votes Thank Flag Link Sat Sep 5, 2009
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