Requesting Repair Credit When Negotiating

[Jason Reynolds]

Hey everyone,

I'm in the process of offering on a house that I plan on house-hacking, so I am obtaining an FHA loan. It is rent ready, but I do plan on adding 2 bedrooms so there will be a small rehab cost. Right now we have a 6% seller assist in our offer to cover some of my closing costs. If our offer is too low, I think it would make sense to accept a higher counter price than I normally would, but ask for a 'repair credit' to be held in an escrow account to cover the cost of putting up the walls and adding the closets, etc. I think this could be a win-win scenario, seller gets the higher price they want, but I am less out of pocket and the property will still cash flow well. I am not familiar with requesting for repair credit though so would appreciate if someone who has done this could chime in.

Here are my main questions/concerns:

• Since the property is already rehabbed and rent-ready, am I allowed to ask for a repair credit for technically unnecessary repairs?

• I had read that some lenders will not allow repair credit to be rolled into purchase price. This is probably something I will just have to reach out to the banks I am dealing with about but want to see if anybody else has run into this issue.

Thanks!