Posted by Tim on August 26, 2005 at 20:45:51:
It seems as if you are trying to intentionally mislead your lender. If the deal were to be challenged later, and document produced (original or copy) would be strong evidence that you were engaged in mortgage fraud. Ethics aside, you expose yourself to risk.
If no document is produced, this risk goes away. However, you expose yourself to the possibility that the seller will demand payment.
If it’s a good deal, a better solution will present itself.
Good luck friend.
Purchase price adjustment for favorable financing - Posted by Carrington
Posted by Carrington on August 25, 2005 at 19:37:38:
Hi everyone. here is my situation. I am qualified for an amazing loan program able to provide 90% financing. My purchase price is 214 and want to do this with as little cash out of my pocket as possible. my seller is motivated and I think he will go down to 210. The market value is 229. can I make an offer for 233,300, pay 210 and have the seller “carry back” a mortgage that never really gets paid? That way, I really only have to pay closing costs and because of the loan program, I still cash flow really nicely.
Re: Purchase price - Posted by jimup
Posted by jimup on September 11, 2005 at 18:40:20:
Two words for you: Loan Fraud!
Better to use hard money to purchase, then refinance the next week using appraised value. FNMA & FHLMC do not have any seasoning requirements to use appraised value.
Re: adjustment for favorable financing - Posted by Jason (SC)
Posted by Jason (SC) on August 27, 2005 at 01:20:31:
That is normally called a throw away 2nd. It happens but I wouldn’t do it. As some one else mentioned, The seller could demand you pay it for one thing. Another thing is any time you intentionally miss-lead the bank it Mortgage fraud.
Back up and try again. I know there are a lot of 100% investor programs right now.
I had a guy tell me one time that Hard money can be an expensive option sometimes, but if your deal doesn’t atleast qualify for it, then its not a real deal.
Re: Purchase price adjustment - Posted by John
Posted by John on August 26, 2005 at 11:36:50:
The only way this works if you disclose this info tyo the lender providing the 90% financing. They probably won’t do the loan. If you do not; IT IS LOAN FRAUD. Fines and jail time and a criminal record for the rest of your life. Not worth the risk.
Re: Purchase price adjust for favorable financing - Posted by Tim
Posted by Tim on August 25, 2005 at 22:16:22:
I would worry that the seller would demand payment, and because I’d be contractually obligated, I’d either have to pay or default and face a possible judgement or foreclosure.
I’d only be comfortable with such an arrangement with a family member or friend I could trust.
I like the way you think though!
Re: Purchase price adjust for favorable financing - Posted by Carrington
Posted by Carrington on August 26, 2005 at 07:39:36:
What if I had a privately held document, notarized, that forgives the loan? I want to make sure it’s not illegal.