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I'm trying to buy a house. It's a fixer-upper and has some issues, but I know what they are, and I'm not concerned. I tried getting a conventional mortgage through a bank, but after they had the appraisal, they said the house needed too much work, and they wouldn't lend on it regardless of purchase price. (I'm not too familiar with the FHA 203k loan, but based on what little I do know, I don't want to use that kind of loan)
I assumed that I'd get a similar response from other banks. And, because I'm not using a Realtor, I approached the owner and asked if he would talk to his attorney to decide if he would be willing to enter into a purchase money mortgage agreement for 2 years. (this would give me time to fix the house up, move in, and refinance with a regular bank - if anyone has any advice about a purchase money mortgage, I'd be interested in that, too) The owner seemed interested, and said he would talk with his attorney about it. (this was Sept 9)
After hearing nothing, I called the owner back on Sept 20. The owner said he called the attorney, but never got a call back. He said he would try again the next day.
So, I wait 2 more weeks with no reply, and call again on Oct 4th. I didn't reach the owner, but left a message asking if there was any news. He didn't return my call, so I tried again on Friday the 9th, and again, he hasn't returned my call. And, I will try again tomorrow.
Here's my question: if I start increasing the number of calls, when would you stop calling it pestering, and start calling it harassment? If I thought it would be productive, I'd call everyday. But, the owner may be very busy, and I don't want to get him angry and completely unwilling to sell the house to me.
I know, in this real estate market, this sounds like a strange situation. But, the owner isn't motivated to sell. (it's a long story. Been in the family for years... Also owns the house next door, and wants to retire there... etc.) Also, because of location, and other factors that are probably only important to me, I would rather keep pushing to get this house, instead of starting over and finding another house.
If you've gotten through all that, I really appreciate your time, and would also appreciate any advice!
...and for whatever reason doesn't want to tell you that. Especially if he's not motivated to sell in the first place. Surely there are other fixer uppers you can look at? Or ones that are currently being flipped?
I wondered about ones being flipped, because the seller may be wanting to unload the property quickly, even if unconventionally. Maybe you could find one that's not quite finished yet, and finish it yourself.
Last edited by muggums; 10-13-2010 at 07:14 PM..
Reason: after thought
If that's the case, I wonder what caused him to change his mind, and why wouldn't he just tell me? I wonder if he has some objection to a purchase money mortgage? If he didn't want the hassle of owner financing, I wish he would tell me so I could try other options.
At this time, there aren't any comparable houses for sale in the area I'm interested in. This house faces a historic park, and is one of only 6 that are not over 3000 square feet. Of the other 5 smaller houses, 3 are definitely not for sale, my friend is trying to buy one, and the remaining one has lost most of its original detailing over the years. (and is in much worse shape)
So you tried calling 3 different times and no call back? I would say give up on it. How did you find the house in the first place? Was it on MLS? Does the owner have an agent or is it FSBO? I'm afraid you won't really ever know the motive for not responding if the owner doesn't tell you. Maybe he found a cash buyer. ??
So you tried calling 3 different times and no call back? I would say give up on it. How did you find the house in the first place? Was it on MLS? Does the owner have an agent or is it FSBO? I'm afraid you won't really ever know the motive for not responding if the owner doesn't tell you. Maybe he found a cash buyer. ??
Yes, 3 unreturned calls.
I've been interested in the neighborhood longer than I knew about the house in question. So I've been attending neighborhood assoc./block watch meetings to get to know the neighborhood better. One of the homeowners nearby, knows the owner of the house I'm trying to buy, and he is the one who introduced me to the owner.
I finally reached the owner tonight and he has been advised by his attorney not to enter into a land contract deal. The specific reason was because the purchase price is so low, causing the down payment to be too small to cover the cost of foreclosure if I would default. But, generally, the attorney is against land contracts because the law favors the home owner, and a land contract can't be written solid enough to protect the seller.
I'm open to more advice if anyone has any. But otherwise, thanks for the replies so far.
JR-C - I'm in Texas - so please excuse if this won't apply in your state, with those specific laws, etc. - but does your state have/allow Contract For Deed transactions? I'm not familiar with the land contract deal you speak of, so maybe they are the same? Here in Texas, the Contract for Deed transaction actually seems to favor the property owner of record, which is the seller.
We purchased our home on a Contract for Deed and it had a 2 year maximum period within which we had to secure our own financing. We made a down payment, signed the very straight forward Contract for Deed and took possession of the house. We refinanced about 15 months into the 24 month window - and while I think this type of 'deal' can be risky - as long as all parties understand the risks, it can be beneficial as well - which it was in our case.
The risk for us was not being able to qualify for our own loan in that window - because if we hadn't, the owner would have taken back possession, kept our down payment, and any payments made during the period, and we'd have been out of the house.
We are on the positive side of the experiences with Contract for Deed sales - and it sounds like you would be as well - because you don't need help with financing, as much as you need 'time' to get the house ready to pass the inspection/appraisal scrunity by a lender.
I think Contract for Deed transactions can be somewhat predatory by nature, if the purchaser is not working hard to be financially able to qualify for their own mortgage within the time period of the contract. I also think these transactions can be tailor made for some buyers
Good luck! I hope it works out for you! Our county land records are free and accessable online - I would be happy to send you a recorded example of the Contract for Deed and the resulting Rescission when the purchaser defaulted on the deal. DM if you'd like to see the TX examples.
Last edited by Rottnboys; 10-15-2010 at 01:45 PM..
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If I thought it would be productive, I'd call everyday. But, the owner may be very busy, and I don't want to get him angry and completely unwilling to sell the house to me.
I would say that he's not interested
