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Updated over 2 years ago,
Can you help me solve a problem with my 1ts deal?
Hey everyone
I am in contract for my first deal and i have a problem
Here is a basic rundown of the deal
2 attached vacant townhouses for 250k each. The current market value is 300k-320k each but i got a good price when i offered to buy both. Rent comps are $2,100 a month per unit I am putting %25 down at 4.5 interest. Tenant pays gas and electric.
The seller was in the middle of rehabbing them when i made the offer and he agreed to finish the rehab before closing. The rehab is mostly cosmetic in nature. But nicely done with a little bit left for me to do (est $2,500)
The lender sent in an assesor that saw the property under construction and approved the loan at an assesed value that reflects the approximate market value indicated above; however the loan is subject to a 2nd inspection after work is completed.
I also did a home inspection which showed that the furnace and boiler in one of the units really needs to be replaced at an estimated cost of $13k which i am ready to absorb because of the resale equity already in the deal
problem is I am concerned the bank will want the furnace and boiler done before closing and I don't want to do that type of work before I close
is there a way to get the seller to do it and I will pay for it after closing? Do I even need to do it before closing ? Should I back out of the deal because of the huge repair even though the deal has so much resale equity?
any other comments on the deal or my questions are welcome.
Thank you!