“I have a problem I hope you can help me with. Im buying a home and the seller agreed to credit me $18,000 for closing costs. The problem is that my bank will not allow a credit over 3% of the sales price, and the price is about $500,000. So theres $3,000 the bank wont allow. My agent suggested the seller just write me a personal check for the $3,000. Is that legal?”
***ANSWER:
Nope. Thats called fraud.
Its illegal for the seller to hand you a big check outside of escrow. You may be thinking, Whats the big deal?
Its a big deal because part of the lenders decision to loan is based on how much you, the buyer, have invested in your purchase. If the seller gives you back funds without the banks knowledge, then you have less invested.
The best solution is to have the seller agree to lower the price by the $3,000. Understand that the seller is NOT required to do under the standard contract.
Hope that helps.
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