With so many Repos that are good deals for buyers, the question that is always asked, will the lender be able to finance the loan when there are Repairs needed and the Contract states SOLD AS IS !
The Answer is YES !
1) If the customer and the property can qualify, then the USDA Program is great for this. Repairs can be financed into the loan as long as the Appraisal can cover for the amount needed. The appraiser will ask for Invoices for the Repairs and will consider the appropriate value into the appraisal based on what needs to be repaired.
2) Then the Title Company will hold the Amount in Escrow and the Customer will need to have those items completed in a period of time set by the USDA and then the appraiser will go out and re-inspect the home for completion per USDA guidelines.
The Buyers benefit, because they can still obtain a 100% financing, NO PMI, and the repairs can be escrowed.
Make Sure that when using this program your Loan Officer confirms that the Customer can qualify for the program, meaning, having the Credit Score and Credit AND to watch out for Payment Shock when qualifying the customer.
Also, it can only be a Purchase for Owner Occupied Property and the Limit for Acreage is 5 acres.
The other Solution is an In House Loan by the Bank which I have done for many customers.
If the customer has money to put down, good credit scores, Debt to Income is in line, then the customer can obtain a Rehab Loan and then when the house is completed the Loan Officer can do Permanent Loan for the customer.
I have been able to help my customers with both Owner Occupied and Investment Properties. Again, they key item is making sure that they qualify not only for the loan Now, but for the End loan as well.
If I can be of service to answer any questions , please feel free to contact me .
Have a great week !
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