Got my ATP yesterday for my FHA PFS. Yay!! Now I have to submit the preliminary HUD. The seller had accepted the offer with the buyer's request for $4000 contribution towards his closing expenses.
I read on the FHA guidelines they only pay up to 1% towards an FHA buyer's closing expenses. This is not FHA and even with the buyer asking for $4000 in closing expenses the bank would net almost $5000 over their 88% required net.
Just heard from the buyer that if the bank won't agree to the $4000 in closing expenses assistance, he's walking. Does anyone have any experience to share about this? Will FHA agree to the $4000 or any amount?
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Push for the Servicer to request a variance. $5000 is a bit high if it's over 3% of the purchase price, but is still likely to be approved when you're meeting the net tiered proceeds.
You should be in good shape. The fact the min net is being met is what should push this towards approval. Tell the lender you need a variance on the closing costs. I would be surprised if you couldn't get this through....