Help! House needs work before it can be financed. What are my options?

Hi all,
I’m a newbie bidding on a short sale multifamily home that needs $18k-$20k work done before the bank will finance it. I have the necessary down payment and am pre-approved for more than the purchase price of the building. I also have funds to get the work done on the property so it can be financed. I know I’ll be bidding against all cash offers.

What can I do to make my offer as attractive as possible to the bank? Is it possible for me to enter into contract and then get the work done before closing? Any help will be appreciated.

Being that there are no replies, I’m thinking that the answer to this question is so easy that even a newbie should know it or so difficult that it has stumpped the experts! Which is it?


it would be crazy for you to rehab the house before you purchase it. If something were to happen to your financing you would lose all of your investment. Why not get a rehab loan so you can just roll it all in. The bank does not know whether you are using financing or a cash offer if you don’t ask for a financing contingency.

This house will end up with a CASH BUYER!! Where else goes it go??

Can’t get financing…your out…simple.

Cash buyers in this market are SCORING deals. I just picked up a 4 bed 2 bath ranch which had a fire in it. The elderly lady was not home at the time and did not pay here home owners insurance for over a year. The home was paid off so no one called her. Insurance company said BYE BYE. No policy in effect!!

NO Insurance + Fire = NO BANK FINANCING

Comps in neighborhood are $250K to $300K

Just signed to buy it for $70,000 CASH, no banks, no inspections, close in 5 days. Fire damage is contained to kitchen and room next to it. Approx. $60K for total rehab and updates.

That’s how these deals get done.