Ok, for your first mortgage on a house, the one you are using to buy the house, do you have the use the entire loan to pay for the house, or can you use on things like fixing the roof, getting new doors, rewiring the house, a generator, and buying appliances(washer, dryer, fridge, stove ect)?
My question sounds a bit rambled so here is an example.
House costs $40k.
You are able to get a loan for up to $60k.
Can you use the remaining $20k on updating the house, and purchasing items for it?
2007-03-18 13:17:55 · 6 answers · asked by asimpledork 2 in Business & Finance ➔ Renting & Real Estate
Ok, so if we were to have the mortgage signed over to us(an assumtion of liability, instead of out right buying the house - which will be able to happen since it is a relatives house who already agreed to this option), and then refinance, we would be able to do as stated above?
I think i might post this as a new question.
2007-03-18 13:39:31 · update #1
Typically you cannot. You'll want to negotiate this fix up to be completed at close of escrow or arrange a seller credit for repairs. Mortgage companies will usually see it as a red flag if a property needs 20K in fix up expenses.
Also, this depends on the appraised value of the home which seems to usually be close to what you purchased it for.
2007-03-18 13:23:25 · answer #1 · answered by Tadow 4 · 0⤊ 0⤋
No, not generally. This would mean you are going above 100% of the value of the home. If the bank had to forclose on the home, they would lose 20K even if they could sell for the cost of the home at 40K.
If you get a loan for 60K, you may then be signing a purchase price for 60K also, meaning you know bout the home for 60K, and all of that is know with the seller.
Everything is worth what the purchase will pay for it. This quote is especially important when pertaining to real estate. The bank won't give you more money on a mortgage (because that will put you upside down on the home) unless it is a really shady company. If that is the case, get ready for some crazy interest rates, and private mortgage insurance which is an extra expense that protects the bank, not you, but you still have to pay for it.
See if you can negotiate these fixes or improvements in the purchase price of the house.
2007-03-18 20:26:20 · answer #2 · answered by 1235 4 · 0⤊ 0⤋
You probably can't buy the appliances, lol, but sometimes you can work repair costs into your offer. You will also want to make the seller buy you a year long home warranty on the offer. Those always come in handy on things you might not catch. But as for seeing actual cash from this type of loan, you're not going to see it. It's only gonna be bills hon.
2007-03-18 20:35:46 · answer #3 · answered by HoofHearted 3 · 0⤊ 0⤋
If you are the current home owner yes this would be a REFINANCE CASH OUT. But not on a purchase, you cannot walk from the closing table with money on a purchase. You can although purchase the home and immediately refinance to the full appraised value CLTV depending on credit scores and income matrix.
2007-03-18 20:24:43 · answer #4 · answered by amstarlender 2 · 0⤊ 0⤋
you can only get a loan for whatever the house will appraise for. and you can only get 100% financing if you have pretty good credit, if you credit isn't so good, you may have to put 10% or 20% down.
2007-03-18 20:24:39 · answer #5 · answered by besthusbandever 4 · 0⤊ 0⤋
Most mortgages today are not assignable
2007-03-18 21:04:16 · answer #6 · answered by Anonymous · 0⤊ 1⤋