Financing Of A Home Just Purchased At The Courthouse.
I posted this in the foreclosure section but want to be sure there are no legal risk for fraud:
If a friend and I buy a house at the courthouse and the deed is put in his name only, can he turn around and sell the house to me for the actual purchase price and will I be able to get conventional financing with 20% down? Sale would be about 30-60 days out from the courthouse purchase date.
See any gotchas??
Thanks ALL!
[ Edited by jllaco on Date 08/01/2011 ]
You would have to ask the bank that is doing the financing for you if you can buy a property when title changed so quick. FNMA or hud may have some seasoning issues.
I did speak to a local banker and he sad no problem on the financing. He said that some law/rule had changed that allows cash buyers to seek immediate financing. BTW, I did gt the house.
This sounds suspect, esp. on an as-is where-is purchase. A through title search if nothing else is required.
So the bank may say "no problem", but it might take 5-months to close the loan.
if you can get a LTV that requires PMI, check out http://www.bankrate.com/finance/mortgages/9-steps-to-cancel-pmi.aspx and Google "how to remove pmi non-owner occupied"..[ Edited by cjmazur on Date 08/05/2011 ]
Just talked to the loan officer and he beleves its only 80%, so no PMI, but he is checking to be sure.