Home Buying in 48062>Question Details

Tracy Callah…, Both Buyer and Seller in 48051

My husband and I fell in love with an old farm house that still needs work. Can we bid over asking price and ask the seller to finish construction?

Asked by Tracy Callahan, 48051 Mon Feb 14, 2011

The seller is asking $83,000. The cost to finish the property is about $50,000.

Help the community by answering this question:

Answers

11
You can do or ask for anything you want, but what actually happens may be a different story. One of my concerns is the apprasial, because it no longer matters what the seller is willing to sell it for and the buyer (you) are willing to buy it for. No. The real hurdle is what the bank will appraise it for, and if it comes back lower that is the new purchase price OR the seller(s) can "back out" and you do not lose your earnest money. Have you spoken with a local agent or Realtor? They should be able to explain this and understand your market there best.

Good luck.
Spirit
1 vote Thank Flag Link Mon Feb 14, 2011
Glad to help, and we are in the same zip code, 48051.
You'll need a buyers agent to negotiate the amount and appraisal, and I am just down the street at 21 and half and gratiot, Advantage Realty Inc.
The repairs would be a 203K FHA loan most likely- it depends on the property and the repairs. And your lender and loan package. I'll need to be in touch with the lender.

Please give me a call, 586-246-3421

Sincerely,
Lauren Quigley, ABR
http://www.PropertySister.com
propertysister@gmail.com
0 votes Thank Flag Link Wed Feb 20, 2013
Sure. But there are some variables to think about i.e loans, banks, true rehab cost, etc.
0 votes Thank Flag Link Mon Feb 14, 2011
Tracy,
I suggest that you speak to a variety of mortgage brokers or bankers to see what other options there might be for your parents to purchase the home as they are the experts. Some have more lending options to select from than others.
Do your parents have to purchase the property using a land contract? Maybe this is the reason that there is no 203K available. Ask the mortgage brokers about it.
Hope this helps.
Good luck!

Laura Feghali
Prudential Connecticut Realty
0 votes Thank Flag Link Mon Feb 14, 2011
My husbands parents are buying the home for us and we are going to do a land contract. They already own a home, so the lender told them they don't qualify for the 203k. There house is also paid off. Is there any other options???
0 votes Thank Flag Link Mon Feb 14, 2011
The sellers might not be willing or able to do the rest of the work. And asking a seller to finish the work might result in mixed signals about the quality level each party is expecting. A better way to handle it might be to get a loan that can incorporate re-hab funds. The appraiser will probably appraise on the finished value.
0 votes Thank Flag Link Mon Feb 14, 2011
didn't read entire question... this doesn't leave much for the Seller as far as profits go. Ask yourself if you were the Seller, would you take this deal?
0 votes Thank Flag Link Mon Feb 14, 2011
You can do whatever you want but whether the Seller agrees has to do with his motivation for selling.
0 votes Thank Flag Link Mon Feb 14, 2011
Laura & Phil bring up good points about the appraisal. But I don't know if I'd want a stranger handling the construction! What makes you think they will not cut corners to save money? I would suggest going with a 203K loan. This will give you the funds to buy the house, plus money for improvements. Not all banks do these, so you'll need to shop around. And with a 203K loan, you're working with FHA approved appraisers & contractors. Good luck!
0 votes Thank Flag Link Mon Feb 14, 2011
Hello Tracy,
Yes, you can offer more money than the asking price for the home and request that the sellers finish the construction but if you plan on financing the purchase then the property may not appraise at that value so you wouldn't be able to obtain the loan at that price.
Also, the sellers may be in a situation where they may not be able to complete construction due to lack of funds. If you are working with a real estate agent , he/she may be able to inquire with the sellers or their agent if this might be a possiblility.
And...there are loans available (203K) where you can finance additional monies to complete the construction yourself. I suggest that you contact a mortgage broker to find out more information about this type of loan.
Hope this helps.
Good luck!

Laura Feghali
Prudential Connecticut Realty
0 votes Thank Flag Link Mon Feb 14, 2011
Good Morning Tracy;
If this is a cash transaction yes you can. This can be stipulated in the contract. But, for your protection, I would have the contract drawn up by either a Real Estate Agent or a Real Estate Attorney.
If you would be financing, please note that the property will have to appraise for at least the amount of the contract. So there should be a contingency in the contract that the contract amount is subject to an appraisal of the property. Again you should consult with a Real Estate Agent or Attorney.
Web Reference: http://www.321property.com
0 votes Thank Flag Link Mon Feb 14, 2011
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2014 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer