FHA Amendatory Clause / Real Estate Certification
Depending on the estimate FHA loans currently make up anywhere from 25-35% of total mortgage originations. Recent experience has led me to realize that although most real estate professionals know what their doing there are many who need a little coaching on the main dislcosure; the FHA Amendatory Clause/ Real Estate Certification (Click here to download the one page disclsoure).
Here are the essential things professionals and consumers need to know:
-This disclosure MUST be signed by the homebuyer(s), homeseller(s), and real estate professionals (both selling and listing agent) involved in the transaction. The signatures MUST be dated on the SAME DATE THAT THE RESPECTIVE PARTY ORIGINALLY SIGNED THE EARNEST MONEY AGREEMENT.
Example
If John & Jody Homebuyer write an offer with their real estate agent Shelly Sellalot to purchase a home on September 1st then John, Jody, and Shelly must sign and date the Amendatory Clause/ Real Estate Certification on September 1st. If the sellers, Jay & Judy Homeseller along with their listing agent Bob Bigbucks respond to the offer on September 2nd then Jay, Judy, and Bob must sign the disclosure on September 2nd even irregardless of their response (unless they simply reject the offer all together).
-Please note that the one page disclosure has two places for the homebuyer(s) and homeseller(s) to sign and one place for the real estate agents to sign.
-What also needs to be filled out? At the top of the form the homebuyer(s), homeseller(s), property address, and date of agreement should be filled in. In addition, the blank space following the “$” symbol in the Amendatory Clause section should be filled with the original purchase price of the offer.
-What are the parties signing? In so many words the Amendatory Clause gives the homebuyer(s) permission to back out of the transaction and receive their earnest money back if the property does not appraise for the amount they are buying the house for. The Real Estate Certification states that the entirety of the sales agreement is disclosed in the earnest money agreement and accompanying addendums which are ALL provided to the lender.
Posted: August 13th, 2009 under FHA, For Professionals.
Tags: amendatory clause, FHA amendatory clause/ real estate certification, FHA loans, real estate certification
Comments
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Pingback from My Mind on Mortgages » The FHA rehabilitation loan
Time December 7, 2009 at 4:49 pm
[...] is pre-approved for 203K loan, finds home and reaches agreement with seller (be sure to have FHA Amendatory Clause and Real Estate Certification signed with purchase agreement), homebuyer must hire licensed/ bonded contractor to get estimates [...]