HELP, Please.

I am negotiating to have owner  approve short sale offer amount . The owner is moving out of country and doesn't want to take furniture with her and wants to  sell it. Hence I want to leverage my offer  as follows : All cash, no inspection, $x amount for condo and $x amount for furniture contingent on lender approval and successful closing.

My concern is that providing money to owner for the furniture may be an issue with lender as it should go to the unit price? What do you think?

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Permalink Reply by ERIC MOBLEY on February 25, 2013 at 5:37am

Furniture is personal and  treat it as such with a separate bill of sale.  It has nothing to do with the lender,  If the seller had a garage sale a few days before the close to get the furniture and other personal property out of the property it is none of the lenders business.

Permalink Reply by Matthew Merenoff on February 25, 2013 at 5:53am

If the buyer wants the furniture a bill of sale will need to be drawn up. Its that simple

Permalink Reply by TOP END Properties on February 25, 2013 at 12:23pm
An old 'trick' investors used to pull to get sellers motivated was to buy furniture for like $3000 (or at least say they were). The lenders will not allow this outside of the HUD and could be considered fraud.
Permalink Reply by Liz Kenneally on February 25, 2013 at 12:53pm

Thanks. @ Top End .. if the sale of the furniture is added as an addendum to the contract and  included in the HUD statement, I don't see an issue with the bank as long as it is disclosed.  

Permalink Reply by ERIC MOBLEY on February 25, 2013 at 1:16pm

Personal if you add it as an addendum then it is you that unnecessarily make is part of the contract.  How is selling personal property which has nothing to do with real estate fraud, Use common sense.  If you add the furniture as a addendum you will be making it part of the real estate transaction.  The bank has no interest or right to tell you what you do or don't do with personal property.

chat·tel  

/ˈCHatl/
Noun
  1. (in general use) A personal possession.
  2. An item of property other than real estate.  *********

chattel n. an item of personal property which is movable, as distinguished from real property (land and improvements).

Permalink Reply by TOP END Properties on February 25, 2013 at 9:32pm
It has been covered by the lenders before. The seller is not to recieve any money at closing. You must put it on the HUD .. but they will not approve it. If you try to hide it from the hud, it is fraud.
Permalink Reply by Bryant Tutas on February 26, 2013 at 3:52am

Completely disagree. We sell many vacation homes in my area. Most are furnished. The furniture package was paid for by the seller and is not part of the collateral for the loan. It's personal property and the seller can do what they want to with it.

Normally we get about $3,000 for the furniture. It is not a part of the real estate contract and is handled by the buyer and the seller.

It's not a part of the closing and it's not on the HUD or in the contract.

Personal property does not go on a HUD and has nothing to do with real estate. Lenders may want to control this bu t they can't. UNLESS the furniture was part of the collateral.

Example:

"Neither the seller or purchaser will receive any funds or commissions from the sell of the mortgaged premises."

Permalink Reply by Liz Kenneally on February 26, 2013 at 4:02am

Thanks for your response.. I will check with an attorney. I understand your response  as well as others.  i

Permalink Reply by Liz Kenneally on February 26, 2013 at 4:13am

In speaking with an attorney, the best thing to do is to check with the lender as to what is their policy .

Permalink Reply by Wayne Brooks on February 26, 2013 at 4:36am

If you check with the lender, they are going to want to control it.  This is outside of the lender's control.  As long as the payment for furniture is a legitimate, market rate you have no concerns.  I agree with Top End that there Can be problems with this when it is NOT legitimate (ie $3,000 for a broken push lawn mower).  In cases where there is an obvious "transfer of extra funds" above the value of the personal property, then yes there is fraud.  The furniture is Not part of the collateral/mortgage note.  What if you wanted to buy their car?

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