Purchasing property with violations

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  • #67116
    frankysmom
    Member

    Hi

    An amazing property came up but it has pest and an electric violation. The property is a REO so it’s “as is.”

    Anyway to make this work? I was told naca won’t allow the purchase of a property with violations. Thanks!

    #67119
    Nelsont
    Member

    Good question. Obviously the violations need to be taken care of before you close. Maybe it would involve getting estimates approved by hand and rolling the repairs into the loan?

    #67176
    frankysmom
    Member

    Thanks, Nelson. Perhaps, @ttrumble has insight.

    #67242
    TTrumble
    Member

    Hello frankysmom,

    First thing, please do me a favor and define “violation”. Do you mean something that is simply known to not be up to code, or something for which a citation has been issued from a local government agency? And if it’s the latter, has the citation been resolved?

    Admittedly, HAND has always been my weak spot, but I’ll consult with the HAND director on this for you. My educated guess at the moment is that in either situation, move-in won’t be allowed until it has been taken care of. Specifically, an electrical problem will likely be considered a health and safety issue.

    My less-educated guess is that there is some latitude where REO’s are concerned since virtually all REO’s are sold “as-is”

    Depending on how serious it is, it could also invoke the major repair/renovation feature where the first six months of mortgage payments are rolled back into the loan and the interest rate reduced to keep the payment the same. This allows you to find and afford temporary lodging while the work is being done.

    In any event, I’ll get with the HAND director and get some concrete answers as soon as I have a few more details.

    Tim Trumble
    Online Operations, NACA
    ttrumble@naca.com

    • This reply was modified 7 months, 1 week ago by TTrumble.
    #67246
    frankysmom
    Member

    Thank you for the response as always. Your educated guess is correct! I was able to get in touch with my local rehab specialist. For the record, the violations were for pest and inadequate fixtures cited by the city.

    #67248
    TTrumble
    Member

    Hello frankysmom,

    I’m glad you were able to reach the rehab coordinator! So I presume you got all the answers you needed?

    Please keep us updated.

    Tim Trumble
    Online Operations, NACA
    ttrumble@naca.com

    #67251
    frankysmom
    Member

    I did, thank you!

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