Q&A: Can I get a mortgage which includes money for renovations?
Question by Gypsy: Can I get a mortgage which includes money for renovations?
The house I’m interested in needs some work – new concrete driveway to replace cracked one, new floors to replace damaged/missing tiles, new cabinets for the kitchen and replace all of the door in the house.
I’m wondering if I can get additional money to do the renovations and just include it in the mortgage. I would need about $ 12,000 to do all of the work.
The house is $ 99,000 and homes in the same neighborhood are valued/selling for $ 125-130k
Best answer:
Answer by Jennifer
You need to look for a 203k loan its designed to help you buy homes that need work. I know bank of america can handle them just ask the local mortgage office and they can give you more information on the loans.
What do you think? Answer below!
Go to http://fha.com
I copy and pasted this for you
CAN A HOMEBUYER TAKE ADVANTAGE OF THE BENEFITS OF AN FHA MORTGAGE ON A “FIXER UPPER?”
Absolutely. A program known as HUD 203(k) lets qualified buyers purchase fixer-uppers with FHA guaranteed loans, and even has built-in protection for the borrower should the repair and renovation process cost more than expected.
So check out the site and read more details
Yes. You will need to get quotations from 3 contractors. After the bank says yes, you will have to get an appraisal for the value of the house after the renovations. This is the number your lender will use.
The main issue you will have is when the money is released to pay the contractor. The bank will need to do an inspection. How do we know the renovations were actually done?
Maybe. Most mortgage companies are not going to loan more than 80% of the appraised value. other homes may be selling for $ 125K to $ 130K, but that doesn’t mean the one you are looking at will appraise that high.
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