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Confused??

I'm in the process of purchasing a townhouse (HUD owned), and i'm actually on my 3rd extension because the process has been so long. Everything has basically been done, underwriting process, home inspection, mold inspection. I thought everything was rolling just fine. But going back about a month and a half, my brother in law did some fixtures on the townhouse (three sinks that were missing were installed, a light fixture on the hallway and some exposed wires by the kitchen sink were capped) well our Relator suggested we do all this work ourselves because hiring a licensed professional would be more costly. So he then allowed us to go in this property and make the fixtures. Well let me just say it's been a nightmare ever since, our lender was asking for documentations from a licensed plumber and electrician for the fixtures performed. We were unable to obtain those considering an experienced but not licensed relative did all the work. Our relator then suggested we contact some licensed plumbers and electricians and or general contractors to obtain the documentation necessary, in exchange I had to pay the price for all that paper work only to be told by the lender that underwriting didn't accept it. I'm a first time homebuyer and this has all been a learning yet very hurtful experience. I wasn't aware of a lot of guidelines and I was misguided by my relator. The loan hasn't been completely denied yet because my extension isn't up until later this week but i'm already thinking the answer will be -Denied- , but all I can do is wait.

  • September 30 2013 - US
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Answers (6)

I agree with all of the other Realtor's.. You can NEVER ever do repairs to a home that is not yet yours..  WOW, I don't know why your Realtor even suggested that repairs be done prior to home being yours that's a BIG "NO NO"..  Your not even allowed to bring in contractors on site to a home that does not belong to you, it belongs to HUD and your realtor knew that!!
HUD is not going to reimburse you for anything and your Lender knows that your buying a HUD home which is sold "as is"..  Lenders know if they can fund on a HUD home just by see the disclosures from HUD classification.. It states it clearly what type of loan can fund on certain HUD homes, it's not rocket science to read the documents for the buyer before putting in a contract..  I wish you Good Luck, on closing this townhome ..
  • September 30 2013
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You are not allowed to make any repairs to the property until it is yours.  I can't believe your agent told you it was ok.  The long escrow is typical right now as HUD is backed up.  I sold a HUD home a couple months ago and it took 2 extensions and one rate lock extension to finally get it closed and about 20 angry phone calls/emails from me.  Your agent has to keep bugging them or else they will sit on your file forever.  The problem is they have no incentive to get it done quickly. I don't think they will deny your loan as long as you give them what they need because HUD wants to get an owner occupant in the house quickly to lessen the impact of a foreclosure on the community and the lender wants to get paid.  Best of luck to you.  Hope it all works out.
  • September 30 2013
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I agree completely with CC, good answer CC!  : )
  • September 30 2013
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Well, yeah.

Sometimes these "guidelines" become "requirements," based on the underwriter, in which case . . . it's easy to get confused.

Rather than unravel this, I suggest getting a clear answer from the underwriter as to what they will accept as documentation and they deciding whether to walk away or comply.

All the best,
  • September 30 2013
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Profile picture for HandyWoman11
Sounds like she would have done better having you as her Realtor!  Not sure if I would continue seeking another unit with the same Realtor when/if she gets denied.  Maybe she can recoup some of her unexpected expenses from her agent's commission .... ?
  • September 30 2013
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Wow, I am sorry you have had such a rough experience. First off as a Realtor I would never recommend anyone make improvements to a home while in escrow. Special financing is sometimes available on a HUD home, did your Realtor check on this before writing the offer? Also hindsight your Realtor should have had you check with your lender in the beginning to make sure there wasn't going to be any problems with funding the loan on what sounds like a fixer. Communication is key when it comes to lending.
  • September 30 2013
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