We recently had a transaction with an entire bathroom incomplete and under construction. Our investor funded the deal before the work was done with the following conditions in place: (1) the home had another working bathroom; (2) there were no health and safety issues (exposed wiring, open pipes, etc.); and (3) 1.5 x the estimate of the cost of the required work was “held back” in escrow, pending completion of the work.
Most lenders do not allow any type of escrow holdbacks, but we have several sources that do. For years, escrow holdbacks were a thing of the past, but they are becoming more and more common with both borrowers and lenders.
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 01524255, NMLS# 335646