Who to market to? Can't use FHA finacing

[Emma T.]

Hi all,

I finally finished my live and flip and put it on the market yesterday. The real estate agent called me and asked if the condo association has FHA approval? I called the community manager and she said no it is not, they let their FHA standing lapse. 85% of buyer are coming to the table as a FHA buyer so this is really going to slow down the sale of the house.

Does anyone have any suggestions on how to sale this property. The house is reasonably priced $244,900.00  

The house is located in Montgomery county  in Maryland.  Any suggestions would be great!! 

Thanks all

Emma

[Chris Mason]

Originally posted by @Emma T.:

Hi all,

I finally finished my live and flip and put it on the market yesterday. The real estate agent called me and asked if the condo association has FHA approval? I called the community manager and she said no it is not, they let their FHA standing lapse. 85% of buyer are coming to the table as a FHA buyer so this is really going to slow down the sale of the house.

Does anyone have any suggestions on how to sale this property. The house is reasonably priced $244,900.00  

The house is located in Montgomery county  in Maryland.  Any suggestions would be great!! 

Thanks all

Emma

 Hi Emma,

Fannie Mae HomeReady. Here's a commercial for it. Your go-to lender probably offers it and can give you some fliers to put out at the open house. 

FHA buyers that you can convert to HomeReady:

- Decent DTI, decent credit, but wants a low down payment option (3% or 5% down v FHA's 3.5% down). It'll be better financing, sells itself.

FHA buyers that you can not convert to HomeReady:

- Maxed out DTI and/or bad credit, and minimal down payment. Not a big deal, since you probably don't want these buyers anyways as the seller. :P

"Why are all these folks that are qualified for better conventional financing being shoved into FHA that is worse financing AND that limits what homes they can purchase?" - that's a mortgage industry-wide problem, and not without controversy. Whenever you read "[this bank] is giving higher cost loans to [this group] even though they qualify for lower cost loans," FHA is part of the story 9 times out of 10. For folks with decent DTIs and credit, you're doing them a favor by nudging them towards HomeReady, are part of the solution to the aforementioned problem, and have nothing to feel bad about. They will get better financing AND be able to buy the property they want (yours).