Reducing Contrat Price and Closing Costs
We just completed the inspection on a home that a client has under contract. Most of the items on the inspection are related to old systems that will need to be replaced eventually, or outdated items since this is an older home. The borrower has a conventional loan and there will be an excess in seller contributions because it cannot go towards pre-paids or buying down the rate. Instead of losing the funds I think an option would be to lower the sales price to reflect the seller contributions that would be lost and lower the seller paid closing cost to the allowable 3%. So the reduction in price+ seller paid closing cost would still equal what the seller was going to contribute and it is still a win win. With the full amount with the two combined the buyer can use those funds towards any upgrades needed.
Has anyone tried this strategy before, or am I on the wrong track?