HELP - Cannot finance property because missing plumbing. Need advice.

[Luke MacDougall]

Hi Everyone,

I'm looking to purchase my first property and have run into an issue with the financing.  Some of the copper plumbing for the 2nd floor bathroom was removed from the property.  Based on what the agent is telling me, the repairs should run around $2,000-2,500 which I am not too concerned about.  I have been approved for a mortgage but the issue is that the lender will not finance the property in its current condition with the missing plumbing.  The seller also does not appear ready to pay for the repairs.

Is there a creative way where I can get the property under contact so that I can make the repairs so that I can still use conventional financing?  I appreciate any feedback!

[Chris Uhler]

@Luke MacDougall 

If you use hard money you'll be giving away equity.  I would try to avoid that route. 

I sold a property last year with a similar scenario. The house wouldn't pass for an FHA loan as it sat, but with 2K worth of repairs it met the lenders requirements. The buyer elected to perform the repairs at their own expense. As the seller, I had them sign a release of liability just to protect myself.

If I were you I would tell the realtor you are fine with performing the repairs yourself and get it under contract.  The lender will then perform a second inspection to verify the repairs were made.  The seller should be thrilled!!  They now have a "vested" buyer that is improving their property at no expense.    

Lock it up!!