- This topic has 7 replies, 3 voices, and was last updated 9 years, 9 months ago by Anonymous.
- May 5, 2011 at 10:47 pm #206433AnonymousInactive
I know they say they will buy your house as is, but do they accually buy your house at a fair price?
- June 10, 2011 at 2:45 am #433772AnonymousInactive
The bank isn’t going to buy your logic.
Worse, you will create paperwork that looks like taxable income to the buyer.
- June 10, 2011 at 2:45 am #433773AnonymousInactive
That would be legal according to mortgage laws.
Contract law and rental laws may differ depending on area.
The seller could also legally “purchase” a $ 5000 pencil from the buyer, prior to the home sale.
- June 10, 2011 at 2:45 am #433774AnonymousInactive
No, I assure you this scenario wouldn’t even be submitted to the mortgage underwriter. It just doesn’t fit.
If anything, it makes it worse because once you say “rent” will be paid and it’s a single family home, the purchase becomes an investment property and all the rules change.
Very difficult to come up with scenarios like this to fool the experienced underwriter who’s job is on the line. She’s going to weed through every crack in the file.
If you have funds you can give a buyer, then the buyer should get an FHA mortgage where gift funds are allowed – depending on who is giving the gift. If the buyer needs more than a seller credit for closing costs and a gift for the down payment, then perhaps it’s not the right time for him/her to purchase.
Whatever you do, make it legal so no mortgage fraud is involved.
- June 10, 2011 at 2:45 am #433775AnonymousInactive
I don’t think so. First, when you apply for the mortgage you will not yet be entitled to collect rent since the seller is the owner. It also would put it into the category of rental property, which is not attractive to lenders right now. They’ll want to see that any money you are counting on has been in the bank for a certain amount of time.
What you might do is a lease/purchase agreement for a certain period of time, say two years, with any portion of the rent being applied to the required down payment and/or closing costs. Not the price, because that won’t show that you have contributed to the down payment.
It takes longer, but it is a way to home ownership. Just be sure to have a professional write the contract. Good luck.
- June 10, 2011 at 2:45 am #433776AnonymousInactive
Your mortgage would then be classified as non-owner occupied which no mortgage companies are doing these days. It’s considered rental property & rates are higher and so is the down payment if you do find someone to do the loan,.
- June 15, 2011 at 10:26 am #289638AnonymousInactive
Usually way below fair market price. They will take advantage of a person they perceive as desperate to sell. Some investors will pay fair prices for a multi-family house, if they want to gamble on the thought that the area is desirable, and that they could get enough rent roll. But in the greatest reality, nobody will buy a house if they think they will lose money.
Other investors will buy houses that they feel can be remodeled, and sold for a profit. But for the most part, investors will ALWAYS want to profit, so in most cases they will under bid the value of the house in the hopes of you taking the bait.
- September 17, 2011 at 10:50 pm #290120AnonymousInactive
It will be fair for them. Not so fair for you. They need to turn a profit so will pay less than FMV. That may be a LOT less than you think your home is worth in today’s market!
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