Federal Pacific Panel Prevents House Closing
- Thread starter Fordiesel69
- Start date
That’s like saying people get in car crashes every day, so why bother wearing your seatbelt?
Right. How many insurance companies are refusing coverage for Square D or Eaton panels?
Plenty of people don't wear their seatbelts.
Maybe seller got another offer and is looking for a way out and to keep your friends earnest money?
If that isn’t the case, offer them a bit more to let the electrician replace the panel prior to closing. If your friend doesn’t have a few thousand to get this done, then buying an as-is house is probably not the right choice. Can they put it on a credit card?
If that isn’t the case, offer them a bit more to let the electrician replace the panel prior to closing. If your friend doesn’t have a few thousand to get this done, then buying an as-is house is probably not the right choice. Can they put it on a credit card?
There is way too much speculation and way too little information to give rational advice on the subject.
1. First off the sellers were ok with an FHA mortgage, first red flag for an "as is" sale. FHA mortgages are and can be very restrictive to property condition. I was an agent in an affluent area of the country who represented homeowners, it was very rare my homeowners would accept an offer with FHA financing.
2. I dont see how the buyers can lose their downpayment. Mortgage contingency is common, if the bank will not write a mortgage buyers get their downpayment back, simple stuff. Doesnt matter if it is "as is" sale or not. Actually all sales are "as is" in the strict sense of the word. Though most contracts give a time frame to have a professional inspect the property AND a mortgage contingency. Unless for some silly reason buyers did not hire a lawyer and allowed the mortgage contingency to be stricken from the contract. IF this is the case, this is the buyers negligence.
3. There is more to this story, there has to be because this deal can not be posted with just a few lines. Clearly the sellers may have other offers or realized they can get more money based on the OP post that the house was a great deal. That would explain their reluctance to move ahead with the sale, clearly their right.
4. Typically what would happen with a headstrong seller in this case and if the buyers wanted the house. The buyers would pay to upgrade that breaker panel at their expense by reimbursing the seller at closing or addendum to the contract to upgrade it. If the sellers do not want too, then clearly they have no motivation to sell the house to the buyers. If the buyers can't afford to give them the money, then clearly they cant buy the "as is" house. Dead house deal, buyers get their downpayment back, move on.
1. First off the sellers were ok with an FHA mortgage, first red flag for an "as is" sale. FHA mortgages are and can be very restrictive to property condition. I was an agent in an affluent area of the country who represented homeowners, it was very rare my homeowners would accept an offer with FHA financing.
2. I dont see how the buyers can lose their downpayment. Mortgage contingency is common, if the bank will not write a mortgage buyers get their downpayment back, simple stuff. Doesnt matter if it is "as is" sale or not. Actually all sales are "as is" in the strict sense of the word. Though most contracts give a time frame to have a professional inspect the property AND a mortgage contingency. Unless for some silly reason buyers did not hire a lawyer and allowed the mortgage contingency to be stricken from the contract. IF this is the case, this is the buyers negligence.
3. There is more to this story, there has to be because this deal can not be posted with just a few lines. Clearly the sellers may have other offers or realized they can get more money based on the OP post that the house was a great deal. That would explain their reluctance to move ahead with the sale, clearly their right.
4. Typically what would happen with a headstrong seller in this case and if the buyers wanted the house. The buyers would pay to upgrade that breaker panel at their expense by reimbursing the seller at closing or addendum to the contract to upgrade it. If the sellers do not want too, then clearly they have no motivation to sell the house to the buyers. If the buyers can't afford to give them the money, then clearly they cant buy the "as is" house. Dead house deal, buyers get their downpayment back, move on.
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Reading between the lines of what OP posted, I don't think a realtor was involved in drafting up the sales agreement.
Did they KNOW you had this ?
That seems dumb. FHA inspections aren't that stringent and even the things they may flag may be easily and inexpensively corrected. I remember our inspector pointed out that our back steps don't have a handrail and the FHA inspector can flag that (he didn't though - maybe it has to be more than 'x' feet height or something) or a previous home, a window pane was cracked. That was flagged but the seller replaced the pane and it was good to go.
On the other hand, if it was a seller's market at the time or it was a very desirable area, they could impose whatever restrictions they wanted.
It's not dumb, Long Island is always a strong sellers market.
As people get ready to move on with their life, they think their house is sold, then comes the FHA... oops, says you need a railing installed on those cement stairs. It's not always as simple as "a window pane is cracked". It can also be an outdated electric panel which this thread is about.
No, this has nothing to do with FHA. They can't find a company that will insure it and without insurance, the bank won't write the mortgage.
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