I have been approved for an FHA loan in which I have to bring 3% to the table. The home was appraised $6000 less than what I originally offered. He does not want to come down on his price because he will not be able to pay off his current mortgage, of which he will be about $6000 short after closing costs and fees with price being at the appraised value. He is currently trying to work out a deal with his lender to give him a short sale on the house. Since all of this has transpired, I have increased my credit score to the point that I am able to qualify for more mortgage programs. Should I check with some local companies to get into a better program with less fess than a the broker I used? Im somewhat leery of doing this because I don't want my current l mortgage company to see that I was shopping around if we would close under the current terms. And I don't want any inquiries to hurt my score. I WANT THIS HOUSE. Any suggestions on making this deal work would be appreciated.
2007-10-21 11:34:23 · 4 answers · asked by Renaisannce Man 1 in Business & Finance ➔ Credit
Its possible not as easy as it use to be like 2 years ago.
Your rate will not be as good as it could be
2007-10-21 12:04:21 · answer #1 · answered by Anonymous · 0⤊ 0⤋
You really need to step back and think about what you are doing. This house you have fallen in love with has some big problems.
First, it appraised at $6K less than what you offered.
Second, the seller is already having to get his mortgage company to approve a short sale because the price you offered won't clear his loan.
So instead of taking the FHA loan you are approved for, you want to find a convention loan that would let you pay more than the house is worth. Doing this with your credit will mean higher interest rates, PMI added to the monthly payment or 2 mortgages to avoid the PMI. Either way would probably put your house payment at 40% or more of your monthly income.
Sounds like the perfect recipe to get in way over your head. If the seller can't drop his price down to the appraised value, walk away from the house. In about another 6 months or so, you'll be able to buy this as a foreclosure.
2007-10-21 15:28:15 · answer #2 · answered by bdancer222 7 · 0⤊ 0⤋
I wouldn't count on 100% financing with your credit score. You need really excellent credit to get 100% financing, and I'm of the understanding that means 700+ (maybe even more like 750+). When you have a contract that you have entered into, as long as the lender is still willing to finance your loan, it doesn't matter that the appraisal is less than the purchase price. Understandably, if the seller can't pull off the short sale, the seller wants to have to pay as little out of pocket as possible. Maybe if the seller can pull off the short sale you might be able to negotiate down the sale price, but I don't think it's likely. Is there a reason you can't go with the FHA loan? I think if you shop around within a short period of time it shouldn't hurt your credit too bad. I am inclined to recommend going through a bank rather than an indepenent mortgage broker, but I think many rogue brokers have gone out of business thanks to what happened in August.
2007-10-21 13:56:31 · answer #3 · answered by Lesley 5 · 0⤊ 0⤋
You have a great loan. I wouldn't want to mess with it. Do you have $6000 that doesn't have to be put on the table? Check with your broker on this.
2007-10-21 12:39:53 · answer #4 · answered by Steveo 5 · 0⤊ 0⤋