House #6: First Offer

April 16, 2009 · 3 comments

After our full-priced sale on The Second Chance House earlier this week, and our expected near-full-price sale of The DIY House next week, I was beginning to wonder if we’ve been getting extremely lucky, or if we’re just doing stuff extremely right (probably both). Well, today we received another full-priced offer (okay, a few hundred dollars less than full price) on The Red Garage House.

As I mentioned previously, this is probably the nicest house in that price range anywhere in its city. So, it wasn’t surprising that we got a quick offer on it (we actually expect another offer to come in this week as well, from a woman who saw it the other day). In fact, we haven’t gotten a single piece of negative feedback on the property yet, and every single person who has been through there has loved the house. But we didn’t necessarily expect another full-price offer in this slow market, so once-again, that’s just an added bonus.

Of course, there are still many hurdles between now and closing, so we’re not considering this one sold just yet:

  • The buyers still have 10 days of due diligence, in which to complete their inspections. The house is only about 14 years old, and was in good shape, so we never even had a pre-puchase inspection on it. I don’t expect anything major to be found (I believe we fixed any/all issues), but it’s possible there are things any inspector would find that we don’t know about. I guess we’ll know in the next 10 days.
  • The house still needs to appraise for the purchase price, and because the sale price is more than double our purchase price, it will actually require two appraisals. There hasn’t been much to sell in this neighborhood in the past 12 months, so I’m not sure there are a lot of good comps in the area, but there are a few on the market for a higher price than ours, and they aren’t nearly as nice. If the appraisal doesn’t come in high enough, we’re happy to reduce the price to the appraised price, so hopefully this wouldn’t hinder the ultimate sale.
  • Most importantly, this is an FHA buyer, so the house is subject to FHA rules. Specifically, the buyers can’t purchase the property until 90 days after the last time it was sold (when we bought it on February 12). This would put the date at May 14. Unfortunately, FHA generally goes by the date my deed was recorded, not the date I purchased it, and because the deed was only recorded this week (the title company screwed up), in theory I shouldn’t be able to sell to an FHA buyer until July. But, this buyer’s lender says that he only cares about the purchase date — not the deed recorded date — so perhaps we can get around that issue. I have a feeling we won’t know for a couple more weeks, at least.

Assuming we can clear those hurdles, we’re scheduled to close at the end of May…

3 responses to “House #6: First Offer”

  1. Shae says:

    Great progress Scott! I thought with the FHA buyers they had to wait 90 days before even signing the contract (as opposed to just 90 days before they can purchase)? Is that not a hard a fast rule?

  2. J Scott says:

    Shae –

    I have no idea if it’s a hard and fast rule or not…I’ve had at least one other FHA sale that went through in under 90 days, so I’ve decided that we’ll let the buyer submit the contract to the lender, and let the lender decide if we can move forward at this point or not.

    If the lender says we’ll have to wait until mid-May (that will be 90 day) to resign the contract, hopefully by that point the buyer will be emotionally committed to the house, and they’ll be happy to wait.

    So, I guess the short answer is: I don’t know if this is going to work, or if the lender will tell us to wait.

    I’ll let you know what happens…I have a feeling this sale is going to be one of our more complicated ones…


  3. ezra says:


    That was subtle but I picked up on it. “Great Scott!” Good one!

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