If seller wants $65K and the appraised value is $85K can you put a lien on property, as a company, for the $20K, to be paid at closing, to be used for fixing up the property in the state of OH?
2007-01-13 09:35:26 · 2 answers · asked by K Y P 1 in Business & Finance ➔ Renting & Real Estate
The question is confusing, but I think I've got the gist of it...
The home is being purchased for $65k. The appraisal states $85k. You want the $20k difference to be taken out a closing, paid to a contractor, and used for improvements to the property.
The short answer is you cannot do that. The value of the home is considered to be the lower of the appraised value or purchase price. For the next twelve months, most lenders will consider the value of the property to be $65k. The appraised value is an opinion. What the house sold for is the actual value. If the house sold for more than the opinion, we rely on the opinion. If the house sold for less than the opinion, then we know the opinion is high.
However, if you wish to get a loan to do improvements to the property, you could apply for a home improvement loan. The bank would set the amount based upon what the home should be worth after the improvements. The bank would then allow draws to be taken from the loan as the contractor completes the work. The contractor completes work, he gets paid for the work. He completes more work, he gets paid for the more work, until all the work is done.
2007-01-13 10:08:21 · answer #1 · answered by CJKatl 4 · 1⤊ 0⤋
Sure you can, but there are just too may answers to this question. Please im me or email me for a more specific answer.
Michael
2007-01-13 17:55:59 · answer #2 · answered by Bestbank Real Estate 3 · 0⤊ 0⤋