The Pre-Flop

I work with a couple Real Estate Investors in the Virginia Beach Area and they mainly invest in Short Sales and Foreclosures to sell back to potential buyers.

I had a client pre-qualified up for a $200,000 FHA Mortgage and the client was interested in buying a short sale, I called up my Investor to ask for a few listings in that price range and showed my client the listings.

The Flop

My client was excited to see a house he wanted and worked with his Realtor to put in an offer.  He offered my investor $180,000 for the listed price at $185,000. The investor then agreed to the offer price but not the closing costs and pre-paids amount.  The contract wanted all pre-paids and closing costs paid from the Investor.

Don't Fold Your Cards Just Yet 

Well my client didn't have the extra 5k needed and his Realtor suggested he look at these other houses that are willing to pay for all closing costs and prepaids but the catch was these were town-houses and cheaper.  My client had his heart set on this Single Family Home, so my client was about to give up.

Use that Ace Up Your Sleeve

I didn't want my client to go away empty handed, so I reached out and told my Investor colleague to...

"Raise His Price to $185,000 and then use my Down Payment Assistance Program to gift the 5k"

The investor look star struck and couldn't believe that he could do that by not coming out of more out of pocket expense.  I told him since this was a Government loan we could use the Down Payment Assistance program which would make all parties happy and quick and easy instead of turning away a sale.

Well of course all parties was happy, The Realtor and the Investor still can't believe that we could do this and are in amazement that they don't do this often.

Well of course, previously we were in the mind frame of conventional mortgages, now that Government Loans are becoming popular again, Realtors, Investors, and Buyers aren't accustomed to this and forget that Family Members or a 501c3 non-profit organization can provide down payment for the buyer :)

The "River"

• The program I used was the Genesis Program (Nehemiah and Ameridream are alternatives)

• The loan is scheduled to close on May 26th 2008 *WooHoo*

• I wrote a blog  last month regarding DAP's found here
  

• I actually enjoy playing Texas Holdem Poker in which this blog was inspired from.  I play in local tournaments hosted by Aces Places in the Hampton Roads Area.  If you ever see me at AJ Gators in General Booth, come play me if you dare :)

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As always thanks for checking out my blog, feel free to leave a comment and have a great day!

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