Comments on: No Credits “For Repairs” Allowed http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/ Seattle's Leading Resource for Real Estate Information Sun, 08 Nov 2009 01:47:42 -0800 http://wordpress.org/?v=2.8.4 hourly 1 By: ARDELL http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/#comment-328843 ARDELL Mon, 17 Nov 2008 22:26:30 +0000 http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/#comment-328843 Barbara, Further to mine above, the spirit of the law is very important to me. If the home purchase was $950,000 and the downpayment amount was 50% and the repair was a $15 GFCI...well, I think you get my drift. Technically these things don't matter...but practically speaking they matter a lot. Barbara,

Further to mine above, the spirit of the law is very important to me. If the home purchase was $950,000 and the downpayment amount was 50% and the repair was a $15 GFCI…well, I think you get my drift. Technically these things don’t matter…but practically speaking they matter a lot.

]]> By: ARDELL http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/#comment-328842 ARDELL Mon, 17 Nov 2008 22:22:20 +0000 http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/#comment-328842 Barbara, As you can see from my response to Eric, I felt the same way as the new law before they passed the new law, so it makes no difference to me. Protecting the lender's collateral and not committing lender fraud have always been part of how I think about what we do. It really is common sense. Some people just forgot, so they had to make a law :) In my most recent sale where this would have been an issue, the seller did not agree to the repair, so that's were it ended. The property is still for sale, and I'm pretty sure most any buyer will want the same repair...so maybe we'll be back in contract one day if it continues to be the best house for my client...maybe not. Barbara,

As you can see from my response to Eric, I felt the same way as the new law before they passed the new law, so it makes no difference to me. Protecting the lender’s collateral and not committing lender fraud have always been part of how I think about what we do. It really is common sense. Some people just forgot, so they had to make a law :)

In my most recent sale where this would have been an issue, the seller did not agree to the repair, so that’s were it ended. The property is still for sale, and I’m pretty sure most any buyer will want the same repair…so maybe we’ll be back in contract one day if it continues to be the best house for my client…maybe not.

]]> By: barbara mcmahon http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/#comment-328841 barbara mcmahon Mon, 17 Nov 2008 22:10:53 +0000 http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/#comment-328841 What experiences have you been having in your practice given the new laws requiring the addendum to go to the lender? What experiences have you been having in your practice given the new laws requiring the addendum to go to the lender?

]]> By: ARDELL http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/#comment-14601 ARDELL Wed, 30 Aug 2006 05:57:31 +0000 http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/#comment-14601 Eric! NO. Sheesh. Withholding part of the agreement from the lender is lender fraud. However, I agree that many loan reps do recommend it. Do you know why the lender has a problem with these things? Because if they have to foreclose they are stuck with the house AND its problems. Best answer is to get the stuff taken care of before it closes. Sometimes I just pay for it instead of negotiating the commission, or in addition to negotiating the commission, depending on the sale price. Don't sweep problems, or repair addendums, under the rug. Get the problems resolved, which is best for all concerned, including the lender. Eric! NO. Sheesh. Withholding part of the agreement from the lender is lender fraud. However, I agree that many loan reps do recommend it.

Do you know why the lender has a problem with these things? Because if they have to foreclose they are stuck with the house AND its problems.

Best answer is to get the stuff taken care of before it closes. Sometimes I just pay for it instead of negotiating the commission, or in addition to negotiating the commission, depending on the sale price. Don’t sweep problems, or repair addendums, under the rug. Get the problems resolved, which is best for all concerned, including the lender.

]]> By: seattleeric http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/#comment-14595 seattleeric Wed, 30 Aug 2006 05:38:40 +0000 http://raincityguide.com/2006/08/29/no-credits-for-repairs-allowed/#comment-14595 I've made a rookie mistake in regards to this. In his 35B, my client wanted the seller to get certification that carpenter ants found during an inspection were taken care of. The day of closing, I find out that the lender was requiring that a pest inspector resolve the problem or declare the property clear of ants. Boy, I freaked out! However, I did manage to get a pest control company in there and start a treatment, which was enogh for the lender to release the funds. The lesson I learned is that whatever is negotiated in the buyer's favor as a result of the inspection, put it in a separate addendum as a generic credit, or reduction in price, and don't give the 35B to the lender. I’ve made a rookie mistake in regards to this. In his 35B, my client wanted the seller to get certification that carpenter ants found during an inspection were taken care of.

The day of closing, I find out that the lender was requiring that a pest inspector resolve the problem or declare the property clear of ants.

Boy, I freaked out! However, I did manage to get a pest control company in there and start a treatment, which was enogh for the lender to release the funds.

The lesson I learned is that whatever is negotiated in the buyer’s favor as a result of the inspection, put it in a separate addendum as a generic credit, or reduction in price, and don’t give the 35B to the lender.

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