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FHA Guidelines - What's Acceptable?

Just recently I encountered a situation with a client and I was curious as to how to make this work in the best interest of my Buyer. My client is getting a FHA loan and there was a seller contribution part of the contract negotiated and executed. It was set up in escrow, all went foward as planned. Inspections were started, appraisal. The end results of the inspection period there was a dollar amount agreed upon in lieu of repairs from the seller to buyer as a credit. Unfortunately, it appears that my client (buyer) is going to have to leave the credit on the table and walk away! Is there another way that we can work this out for both parties and include this that would make the lender happy and make it legal for everyone included? Keep in mind, the seller contribution is for pre-paids and closing costs, this was stated already in the appraisal turned in already to the lender/underwriters. Will this negoitated amount be lost or is there something we can do to not leave it on the table? All and accurate and legal advice is welcome!!

Tags: FAQ, FHA, Negotiations

Views: 15

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Replies to This Discussion

Permalink Reply by Anthony Johnson on February 15, 2008 at 11:30pm
Hi Candance, Sellers or other third parties such as real estate agents, builders, developers, etc., or
combination of parties can contribute up to 6% of the property’s sale price towards the
buyers actual closing costs, prepaid expenses, discount points and other concessions.

Closing costs normally paid by the borrower are considered contributions if paid by the
seller. If any of the allowable closing costs, are paid by the seller or other interested
parties, they cannot be included as part of the borrower’s statutory 3% cash investment.
Lenders may also contribute towards the Borrowers costs, and are not included in the
6% limitation.
Permalink Reply by Tom Burris on October 11, 2008 at 7:45am
Escrow holdback for repairs.
Case by case and only for certain things.
Permalink Reply by Jackpott Alleh on March 20, 2012 at 6:16am

I'm belongs to same profession, this is my webpage:  St Petersburg Real Estate

I like your way of work!!

http://www.movepinellas.com/
St Petersburg Real Estate

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