Trying to close on property with major roof issues, what else can we do?

Asked by Mike & Mary Beasley, Riverview, FL Mon Jan 28, 2013

We are trying to buy a REO property nearby. We have a contract on the home, but inspection discovered original 36-yr-old roof with major leaks. We cannot get insurance on the home without replacing roof. Bank will not make any repairs or concessions; lender will not increase amount of current loan. We do not have the cash to pay for a new roof upfront. Does anyone have another idea, or have we exhausted all options? This would be a great deal if we could get the roof done.

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5
Lisa Reeves, Agent, Tampa, FL
Mon Jan 28, 2013
203K may be your only option if the bank will give you enough time. The appraisal covers, the current value and after repair value. If the after repair value is adequate you can get the funds to do the repair. Check with your lender on how to do this.

Another option is that you may want to look into a rehab insurance policy which will allow you up to 6 months to do major repairs, i.e. electric and some structual. It does cost a little more. However, you will need to have money to do the roof yourself. A small loan from a family member after closing to repair the roof may be worth it if the deal is really that good.
1 vote
Alma Kee, Agent, Tampa, FL
Mon Jan 28, 2013
There is also the HomeStyle Mortgage (A Freddie Mac product) and Wells Fargo does these.

With HomeStyle you would have to put down at least 5%. With an FHA 203k fixer upper mortgage you would only have to put down 3.5% of the sale price.

Some lenders do not do the "renovation" mortgages so immediately tell your current lender you MUST find a lender than can do these types of loans.

You will need an extension and hopefully the asset manager for the bank will grant you the extension based on the bad roof inspection.

Hope this helps.

All the best,
Alma
Alma Rose Kee, PA
Future Home Realty
813.244.9898
0 votes
Ron Thomas, Agent, Fresno, CA
Mon Jan 28, 2013
Did you try sending the INSPECTION REPORT and ROOF ESTIMATE to the SELLER/BANK and see if they will budge on the price.
You can possibly get a loan that includes repairs; if the total doesn't go too high.
Talk to your Mortgager.

This is not impossible; it's been done before, once or twice!
0 votes
Danielle Sha…, Agent, Cape Coral, FL
Mon Jan 28, 2013
Sounds like it's time to move on.
0 votes
Vickie Bruni, Agent, Sun City Center, FL
Mon Jan 28, 2013
talk to your realtor. if you can, cut your loss and walk away.
0 votes
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