I ran into this issue just 2 days ago – and I wanted to share with you how to roll repairs into a purchase price.
If you are buying a house that needs minor repairs – but the seller refuses to do them – what do you do?
This situation happens a lot, especially on bank owned homes.
The simple answer is to use an escrow hold back. …an escrow hold back is a small amount of money that is held out of the seller’s proceeds from the sale to make the repairs.
You have to write the escrow hold back right into the contract – under special provisions. To avoid having to rewrite this clause – be specific. Your realtor will need to write – “An escrow hold back in the amount of $______ will be used for (specific) repairs.”
One key with the escrow hold back is the repairs need to be minor – and they can’t take that long to finish. …an average amount of an escrow hold back is $1,500 to $5,000.
Knowing how to solve minor repair problems on an offer – can sometimes make the difference between getting a great deal on a house, or not buying it at all.
That’s it for today!
Have a good day today! …and thanks for reading.
Brett
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