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splaske45 · Joined: 01 Jun 2009 Posts: 2 2.40 Dollars($)

Greetings, glad I found this place!! On to the question...

My father acquired a house from an estate, assessed at the time at $169,500. It can be sold for no more than that amount.

I have around $8,000 to put towards this purchase and am going with an FHA loan. My father wants to NET 169,000 off the deal, and I am left thinking this is impossible with my $8k, unless I can roll the closing costs and such into the mortgage AFTER the sale price is figured as with MIP.

(I am thinking this would require a sizeable seller concession, resulting in a lower net for him).

Can anyone be so kind to break this down as to how it would realistically work? I have spoken with two local brokers and they have both given me some confusing information.

THANK YOU!

-Steve

sara · Posted: Tue Jun 02, 2009 1:47 am Post subject:

Hi splaske,

I suppose you want to use $8000 as a down-payment towards the loan and you want a loan where in the closing costs will be rolled into the total amount. Basically you want a "no closing cost" loan. However, due to the present market situation, such loans are hardly available now.

I would rather suggest you to use the $8000 towards closing costs whereas you can secure the down-payment as a gift from your friends or relatives.

Take Care.

SSPINGARN · Posted: Tue Jun 02, 2009 6:54 am Post subject:

also you are only allowed 6% seller consession which has to get attached to the loan amount

gmakerley · Posted: Tue Jun 02, 2009 9:21 am Post subject:

if your dad sells the home for $169500 and owes nothing, then his net will be $169500. how your finances enter into this equation is something that i don't quite get. you appear to be trying to borrow more than the value of the home - that's not realistic.

splaske45 · Joined: 01 Jun 2009 Posts: 2 2.40 Dollars($)

My father cannot NET more than 169,500. However we were considering making use of a 6% sellers concession to help me pay for some of the prepaids, and closing. This would seem to NET my father the 169,500 (-) the sellers concession.

And to sara, yes you can simply bump the sale price and include a sellers concession for the same amount (under 6%) to cover most/all your closing costs. So, I don't suppose the idea to be "hardly availible".

I am a first time homebuyer. I am now looking into using the $8,000 tax credit towards my closing and asociated prepaids and costs. I have the 3.5% downpayment necessary. Using a standard FHA it is looking as though I can close the deal bring roughly $7,500 to the table and netting my father the full asking price (no seller concession).

Do any of you have experience with using the 8k tax credit directly towards an FHA closing?

gmakerley · Posted: Tue Jun 02, 2009 11:41 am Post subject:

i believe i saw a note within the last week or two that the tax credit cannot be available until after closing on a purchase. i know that there was a plan to allow "bridge" loans so that money could be used right away, but if my memory isn't too hazy, that was given the kibosh.

Realgeni · Joined: 13 Apr 2009 Posts: 1434 99.76 Dollars($)

On May 29th HUD announced some thign on these lines, but it may nto apply for every one.

The American Recovery and Reinvestment Act of 2009 offers homebuyers a tax credit of up to $8,000 for purchasing their first home. Families can only access this credit after filing their tax returns with the IRS. This announcement details FHA's rules allowing state Housing Finance Agencies and certain non-profits to "monetize" up to the full amount of the tax credit (depending on the amount of the mortgage) so that borrowers can immediately apply the funds toward their down payments. Home buyers using FHA-approved lenders can apply the tax credit to their down payment in excess of 3.5 percent of appraised value or their closing costs, which can help achieve a lower interest rate.

For more details please check the HUD website

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FHA Seller concessions with a twist... Need Help!