cash back at closing

[Frank White]

can someone throughly explain cash back at closing? more specifically, how the deal is structured? what the lender requires?

[Ryan Webber]

Wow, I think maybe you haven't seen all cash back at closing "schemes" as you put it.

First off some loans are designed to give you cash back at closing. I've personally had several hard money loans in which I got cash back at closing. It is actually extremely common to have fix up costs rolled into a HML. I've also done commercial loans with cash back at closing. The offices and shop I have, my banker put in an extra $30,000 into the loan for fixup. I walked out of closing with a check for $31,000. I've also heard of, but have never done, some conventional financing with cash back at closing. Actually I think a loan officer was advertizing it on this forum.

Now don't get me wrong, I understand MOST traditional lenders do not allow cash concessions by the seller. I understand that falsifying any documents to get cash back at closing is illegal, but to make a general statement that if you get cash back at closing then you are breaking the law is a little ridiculous.