House selling drama (and FHA loan questions)

[SusanBAnthony]

Our house has been on the market for 5 months now, we have steadily dropped the price, and cannot go any lower.

It went under contract a month ago, and they backed out after the inspection for stupid crap (cracks in the driveway... Hello, didn't you notice that before you made an offer? Their "inspector" was actually a friend of theirs who was in construction. Whatever.)

So we put it back in the market, and also put it for rent, as we are in the red every month paying the mortgage and rent in our new town. It is listed for rent about 200$ more than the mortgage payment including taxes and insurance, but the taxes will go up since now we won't have the homestead exemption. We have had interest in the house for renting- one person is filling out the application so far, and apparently it will get busier as we get closer to the first of the month.

We got an offer today for 187k. House is listed at 199. Previous contract was for 192. Both offers included us paying 3% CC as well. This new offer is an FHA loan, though, and I am concerned that we will end up being asked to pay for a bunch of stuff since I know FHA loans are pickier. With the first contract at 192, we were going to be bringing 7k or more to closing.

So my worst case scenario is we go down the path of selling, agree on a price, aid spect and appraise, and they want a bunch of stuff fixed, and by that time we have missed the window to rent for sept 1 move-in. Now we are looking at oct 1, and the later we wait, the fewer people are going to be moving in freezing cold MN, ESP since the house is commanding higher rent for being in a super good school district- people with kids want to move before school starts the first week of sept.

So. Thoughts? What stuff can we expect FHA to be picky about?

[kaylie]

FHA can be pretty picky. Things I've heard include scraping peeling paint, repainting, replacing railings, etc. I would be concerned that the cracks in the driveway could come up since FHA is usually pretty concerned with anything that could be called a safety issue.

I know you're already shelling out a lot, but I wonder if you could pay for an appraiser to come by and let you know what FHA issues might exist.

[SusanBAnthony]

DH just talked to our agent, and I guess we are going to be getting another offer tomorrow from someone else! Woohoo! Sounds like we will have options, which is nice.

I will update as soon as I know anything concrete. If the other offer is not FHA, we will probably take a lower price, just to be done with the least amount of hassle possible!

[SusanBAnthony]

Got a second offer for over asking, and it is conventional financing. Guess I shouldn't have freaked out last night!

[kaylie]

Nice! Glad it worked out. Good luck with the rest of the process!

[simpsongal]

We did an FHA loan and bought an as-is fixer upper. We had no issues closing our loan.

[sjh722]

Aug 17, 2012 11:08:13 GMT -5 SusanBAnthony said:

Got a second offer for over asking, and it is conventional financing. Guess I shouldn't have freaked out last night!

Congratulations! That's a relief.

[firechiefsbride]

Aug 17, 2012 11:08:13 GMT -5 SusanBAnthony said:

Got a second offer for over asking, and it is conventional financing. Guess I shouldn't have freaked out last night!

Hooray!!!!! Good luck that it goes well.

[lemondrop]

Aug 17, 2012 11:08:13 GMT -5 SusanBAnthony said:

Got a second offer for over asking, and it is conventional financing. Guess I shouldn't have freaked out last night!

Good for you!

Although it no longer matters because these buyers have conventional financing, I'll probably never accept FHA or VA before. I'm all for helping people buy a home and helping vets out, but both of them ask the seller to bend over backwards in ways that put the strain onto the seller more than it should.

[chrissy05]

We are about to close on our house and the buyers have an FHA loan. There were really only two major things that came up during appraisal because they were FHA buyers:

1) Railing on steps out of our kitchen. We never use the door/steps but they are high so I can see why a railing is needed.

2) Fire Door between the basement and garage. Luckily the appraiser didn't notice or write this up so we lucked out!

Good luck!

[SusanBAnthony]

Another question- the close date is mid October. Is it formal to close that far out? W have long since moved out so we would rather close, like, tomorrow. We asked them about it, and they were willing to move that date up a week and pay 1000$ more. It's not going to kill the deal by any means, but I am not very happy with it. But I feel like I am probably being too crabby about it. I just don't want anything to fall through, and have lost 2 months.

[kaylie]

60 days is on the long side of normal, but still within the realm.

[pitterwoo]

good luck! I hope it works out smoothly

[davescatch]

woohoo - glad you got a better offer. Please keep us posted

[minniebee]

Aug 17, 2012 14:18:39 GMT -5 lemondrop said:

Good for you!

Although it no longer matters because these buyers have conventional financing, I'll probably never accept FHA or VA before. I'm all for helping people buy a home and helping vets out, but both of them ask the seller to bend over backwards in ways that put the strain onto the seller more than it should.

I don't think this is a fair statement.

I purchased my first home with an FHA loan, and the seller didn't have to do anything crazy after inspections. In fact, I don't recall that any repairs were requested at all.

I purchased my second home with a VA loan, and again, no issues. The only thing the seller had to do was install carbon monoxide detectors, which is legally required. That would have come up in inspection regardless of what kind of financing we were using.

[Deleted]

I think the beginning of October seems reasonable. Most banks require 45-60 days to complete the loan application and approval process.

[kaylie]

Aug 19, 2012 16:29:28 GMT -5 minniebee said:

I purchased my second home with a VA loan, and again, no issues. The only thing the seller had to do was install carbon monoxide detectors, which is legally required. That would have come up in inspection regardless of what kind of financing we were using.

But the difference is, VA might not give you the loan unless the sellers put in the detectors and conventional wouldn't care. In our market it's tough to get a house with FHA financing because inventory is low and sellers are getting to be picky. If might have worked out fine for you, but there have been enough horror stories out there that there's reason to be concerned as a seller.

[SusanBAnthony]

Jul 26, 2013 0:35:46 GMT -5 julesb said:

A good-looking house is a house that will appeal to buyers, or even the Federal Housing Administration (FHA). Do you know how to get your sale property prepared? Here are a few recommendations for making your house FHA eligible - because buyers with (link redacted) are plentiful, and you'll want to make sure that the FHA will be prepared to finance the purchase of your sale property.

Thanks, lol, 6 months later.

it closed with no problems with the conventional buyer btw.  

And with the new FHA changes, I would be even more scared of a FHA buyer because I would assume that anyone who is resorting to an FHA mortgage really, really cannot afford the house, given the pmi for life.  

[emoflamingo]

Jul 26, 2013 6:57:34 GMT -5 @callmefia said:

Jul 26, 2013 0:35:46 GMT -5 julesb said:

A good-looking house is a house that will appeal to buyers, or even the Federal Housing Administration (FHA). Do you know how to get your sale property prepared? Here are a few recommendations for making your house FHA eligible - because buyers with (link redacted) are plentiful, and you'll want to make sure that the FHA will be prepared to finance the purchase of your sale property.

You do realize this thread was dated from August of LAST YEAR right?!

I was completely, 100% confused.

[thatgirl2478]

Jul 26, 2013 6:41:25 GMT -5 SusanBAnthony said:

Jul 26, 2013 0:35:46 GMT -5 julesb said:

A good-looking house is a house that will appeal to buyers, or even the Federal Housing Administration (FHA). Do you know how to get your sale property prepared? Here are a few recommendations for making your house FHA eligible - because buyers with (link redacted) are plentiful, and you'll want to make sure that the FHA will be prepared to finance the purchase of your sale property.

Thanks, lol, 6 months later.

it closed with no problems with the conventional buyer btw.  

And with the new FHA changes, I would be even more scared of a FHA buyer because I would assume that anyone who is resorting to an FHA mortgage really, really cannot afford the house, given the pmi for life.  

Sorry to respond again in a really old thread - but why would their being able to afford it cause you to be scared of an FHA buyer?  If they are able to get the loan, why does it matter to the seller what happens down the line?