Home buyer is asking for 12.5% cash back from home seller without disclosing on HUD? Is it Legal?

I am selling a town house for say 175K. One home investor came to me and said that he would buy my house for 200K but I shall have to cashback 25K to him without disclosing it on HUD. He got my property appraised for 200K and is able to get a loan for 200K. As a seller is it OK for me to go with this deal without further implications? Is it leagal? I am not doing any fraud and I am not selling property at higher price than that of appraisal. Thanks for your answers

Home buyer is asking for 12.5% cash back from home seller without disclosing on HUD? Is it Legal?

F R A U D

Home buyer is asking for 12.5% cash back from home seller without disclosing on HUD? Is it Legal?

Non- disclosure on the HUD 1 is loan fraud. Don't do it.

Home buyer is asking for 12.5% cash back from home seller without disclosing on HUD? Is it Legal?

This does not sound like fraud to me, but you should contact a real estate attorney to be sure. Why doesn't he just buy your condo for $175,000 and then get a home equity loan for $25,000? Either way he has a loan for $200,000. Fraud or not, it sounds like this guy is trying to screw somebody. Is he going to make you sign something under the table to make sure he gets the $25,000 back? If not, what is to stop you from keeping it?

Home buyer is asking for 12.5% cash back from home seller without disclosing on HUD? Is it Legal?

Fraud - run away. The lender will normally lend on either the appraised value or the purchase price, whichever is LOWER. That is their baseline. It will be difficult (not necessarily impossible, but difficult) to buy it for 175k and then two days later try to get a home equity - regardless of the appraisal.

Call an attorney - in fact, call your attorney general. That appraiser could be in the mix as well. There is a ton of real estate fraud that goes on. They are counting on good natured people to unwittingly join in.

Hope that helps.

Joe...

Home buyer is asking for 12.5% cash back from home seller without disclosing on HUD? Is it Legal?

It's the big F word in more ways than one. Honey, what this investor is doing is highly illegal. No it is not ok to go further into this deal. Take those nikes and run the other way.