September 16, 2019 at 6:59 pm #59745lovjonny5Member
I am an approved members and have been searching for a months. I am having a difficult time finding a home being that the prices are insane. My realtor and I were thinking about looking for a home with less rooms and or bathrooms at a lower cost and hopefully finance the extra room and bathroom thru hand if the numbers permit. Like an addition. I’m concerned about city permits. Is this possible? I don’t have much time left and I’m getting desperate. A need a new tactic fast!September 16, 2019 at 8:31 pm #59747
This is indeed possible. 2 things you have to keep in mind are time and safety.
If you don’t make any repairs you are looking at 2 to 3 months from accepted contract close. If you build an addition you are likely looking at closing in the spring of 2020 if the seller accepts your offer today.
Any additions or major repairs that the seller will not make need to have an architect draw up plans and submit to hand for approval. Hand will also not allow you to live in (or close on?) The house while it is under construction unless the renovations do not impact the livability. This is why they offer 6 months of deferred payments. An example would be if you are renovating a bathroom you can’t live in the house unless you have at least 1 other fully functional bathroom. Or finishing a basement if the rest of the house is untouched. If you are putting on a full addition and knocking down walls especially exterior walls you may not be able to live there until it’s completed. Just something to think about.
My advice if time is of the essence you want a turnkey house from a motivated seller.September 16, 2019 at 10:36 pm #59754lovjonny5Member
Thank you for your response. Just to be clear. Should hand inspect the home first to confirm an addition is possible. Also construction would start after closing correct? Meaning I would be able to close normally.September 17, 2019 at 7:10 am #59756
Hand doesn’t inspect anything. They review the home inspectors report and make determinations from there. In your case they would also review the architect’s Designs.
Closing depends upon the unique circumstances to you and your house. You can close before or after depending on what hand determines.October 29, 2019 at 12:15 pm #61789Emerald1516Member
Nelsont is not exactly correct you actually close on the home BEFORE you make any repairs. The seller has nothing to do with it, they would absolutely not let a buyer start knocking down walls etc. until the closing is a done deal. The person who introduced me to NACA bought a home that needed required repairs and they also had some desired changes. The seller made absolutely no repairs. They bought the house for 82k and had two estimates that the work needed and the work they wanted (wish list) would cost another 25k. Obvi the numbers have to still meet your PITI and the before reno and the estimated after reno appraisals have to work. So they closed on the house like a normal closing and took the house “as is” after closing they hired a naca approved contractor to do the work which including adding a bedroom in the basement, some pipe and electrical repairs, painting the whole place, and a new fridge. I should also add they did not need to use an architect because they were not making any structural repairs or changes. Their estimates were done by contractors. Permits are going to be totally dependent on where you are looking to buy all that stuff is controlled by your city or township. Once you know what kind of repairs you are facing the contractor should be able to give you an idea of what will be needed regarding permits. I am hoping to buy to buy a fixer upper too.October 29, 2019 at 12:40 pm #61790
My sister bought a house through NACA in 2018. The house needed a new roof among other things and while going down the wormhole she ended wanting to create an open floor plan by eliminating the wall between the dining room and kitchen. The seller would not take on any repairs. She had to finance it herself by putting everything on her wish list and rolling it into her mortgage. HAND made her hire an architect (I can show the email from her HAND coordinator if she feels like talking about) and did not clear her until the repairs were finished…she was in limbo for about 3 months while repairs were made and ended up closing about 2 weeks after HAND cleared her re-inspection report…so maybe the process changed? Or maybe it’s dependent upon situation?October 29, 2019 at 12:50 pm #61791Emerald1516Member
Honestly I would love to see those emails because any work done before closing HAS to be done by the seller here in Illinois there is literally NO WAY you can legally have a plumber, roofer or contractor doing work on a house you do not yet own. The liability and legal issues there are endless. A roof may require an architect again that is all dependent on where you live (city permit codes) and the nature of the repairs but again any buyer made changes here in Illinois are unequivocally made AFTER closing.
Any required repairs can be A) made by the seller before closings B) made by the buyer by being wrapped into the mortgage and done after closing by a NACA certified contractor.
Imagine a buyer puts a new roof on the house and then the seller for one reason or another decided not to close on the deal or title issues are later discovered and now the buyer is left holding the bill for placing a new roof, kitchen, whatever on a house they do not even legally own.October 29, 2019 at 1:11 pm #61792
I will ask her and see what she says. I agree with you though there are plenty of reasons why things should be a certain way. Here’s what I know for certain: Maryland is weird when it comes to home buying regulations. It contains one of the poorest areas in the country – Baltimore – 8% unemployment (of those actually registered), 25% adults on food stamps, 42% of children on food stamps, 25% below the poverty line and 55 individual neighborhoods with a greater than 50% unemployment rate (more realistic than the registered number) and yet still has the highest median income of any state in the country. The home values are indicative of that and the rules are skewed toward people with money such as grants being considered seller contributions because a buyer contribution must be in the buyers bank account prior to loan application and seller contributions on conventional loans capped at 3% total making grants almost not worth it and grants plus seller contributions almost not possible.October 29, 2019 at 3:04 pm #61797frankysmomMember
@nelsont can you find out what type of documents the architect had to submit? Structural drawings or construction drawings and did they have to be permit ready? Thank you in advanceOctober 29, 2019 at 4:07 pm #61799
I can ask. Though you will also want to ask your MC/HAND coordinator. As we know every state has different rules so I am not sure if this would fall into the naca requirements or state requirements.October 30, 2019 at 5:40 pm #61817TTrumbleMember
Very simply, there will not be any buyer-funded repairs on a home until they have closed on the home. Common sense alone would dictate that you would never sink a dime into repairs on a home you do not yet actually own for several reasons.
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