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Dealing with Banks


Rob D

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About 6 weeks ago I found a little house that will fit my needs well so I made an offer on it. After having the home inspected we found the roof would need to be replaced. We were in a bit of a tight spot because they seller has no money to fix the roof, and I don't want to pay for the repair because if there is any problems with closing I'll essentially be purchasing him a new roof. After tons of back and forth we worked out a deal for him to have the roof repaired with a roofing company that was willing to be paid on the closing date, this way I can add the repair cost into the offer and the roof can still be fixed before closing.

Fast forward to today - the Bank's appraisal report came back and they gave me a list of 10 items that need to be repaired before I can close including replacing all of the flooring in the house. The crazy part is that the appraised value is exactly what I offered for the house - $72K. I understand that they don't want to get stuck with a junky old house, but I'm putting 20% down and all of the items on the list were things I was going to repair ONCE I OWNED THE HOUSE. The seller has no money to fix anything, and this may cause the deal to fall through which means I'm out the $450 mortgage application fee and the $300 I spent on the home inspection. Unbelievable.

At this point I'd rather be kicked square in the junk than ever have to deal with another bank on a mortgage. The term "necessary evil" comes to mind.

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Every bank will be that way. Too many foreclosures and people with empty promises.

A motivated seller would figure out a way to get the stuff fixed if he really wanted to sell. Though if you didn't ask for any repair money, it's on you.

It sucks but I wouldn't put a dime into a house until after closing.

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Sometimes the mortgage lender or banker will allow someone to put money in an escrow account to be used for repairs after closing.

So, put money for roof/flooring in escrow, bank approves loan, buyer/seller close, escrow money pays for repairs.

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Try finding a mortgage broker.

We got burned by one back when we refinanced our house. You pay the "initial fees" and get a rate lock that's good for 30 days.... and if interest rates are rising, the mortgage company just sits on the paperwork until the 30 day lock expires forcing you to rewrite the loan at the higher interest rate. It's a scam that was burning so many people the California attorney general investigated but nobody did anything about it. We ended up forfeiting our $500 loan fee and going to a different broker.

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