House #21: First Contract

June 7, 2011 · 2 comments

We received our first offer on The Leak House today…and we expect to have it officially under contract by Wednesday…

The buyer is getting funding through NACA, which is a program we love, as it means the buyer has already gone through most of the underwriting steps necessary to approve a loan. NACA buyers are more likely to close and less likely to run into financing issues, which is great (I wrote a little bit about NACA in this old post). The only downside is that it means we won’t be able to work with our preferred mortgage broker and closing attorney on this deal (the big downside of NACA is that they have their own people do the financing and closing).

Typical for a NACA offer, the buyer put in a very strong offer, but asked for a lot in closing costs (used to buy down the interest rate on the loan). The biggest risk with that is if the appraisal comes in low, in which case we’d likely have to drop the sale price, but still pay a lot in closing costs. But, our track record with appraisals is very strong, so we’ll cross that bridge if and when the time comes; hopefully there won’t be any issues on that front.

The buyer has 10 days to do their inspections (including a NACA-approved inspector) and we’re hoping to close this one in about 30 days. I’ll have more to say once we get through the inspection and appraisal…

2 responses to “House #21: First Contract”

  1. Chop Chop says:

    How did the closing go? I bet it was a nightmare. NACA is the worst. Would love the feedback on what happened

  2. J Scott says:

    Hey Chop Chop –

    We actually love NACA. While this closing took an extra couple weeks, that’s pretty unusual for them, and there was never any issues that made us concerned that the deal wouldn’t close. In fact, that’s the best thing about NACA — you know that the buyer is qualified BEFORE they submit their offer, and if you can come to an agreement on terms, the deal WILL close. Not to mention, NACA inspections and appraisals tend to be a bit easier than typical deals.

    Perhaps it’s just us, or perhaps it’s just our area (there are a lot of NACA buyers around here), but we’d take a NACA buyer over a typical FHA buyer any day…

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