Say for renovations?
If so, is there a limit?
2007-10-28 06:13:45 · 8 answers · asked by monaya 2 in Business & Finance ➔ Renting & Real Estate
Dear Omar, Do not ask a seller to increase the price on a house, and have it out in escrow! This is a statute violation (R.E.S.P.A.). Besides, the seller would have tax issues! Some of the people here give bad advice, and do not have the professional knowledge to do so. If you are purchasing a home, and it requires MORE than $5,000.00 in renovations, and meets F.H.A. requirements, ask your lender if they participate in the F.H.A. 203K program. This program lets you close on the improved value, move in, and do the improvements as required with funds from the excess being financed. Example: Sale price$150,000.00 improvements$11,550.00 = mtg amt. $161,550.00 + M.I.P. . The $11,550.00 is held in a legal escrow acct. and is released as improvements are completed. A assigned F.H.A. inspector will sign off, (after re-inspection) and funds are released. Hope this helps, Good Luck!
2007-10-28 06:44:59 · answer #1 · answered by Anonymous · 0⤊ 0⤋
You can request anything. I think you are unlikely to get it. Banks can do construction loans, but I don't know if they will combine a mortgage loan for your purchase with a construction loan.
P.S. I presume the construction would add to the value of the house. The bank may give you a loan based on the estimated new value after improvements...
2007-10-28 13:25:50 · answer #2 · answered by hottotrot1_usa 7 · 0⤊ 0⤋
Generally speaking, NO! Lenders will only lend off the appraisal or sales price, which ever is lower.
There are special programs where you can borrow 103%. (closing costs).
...and there are construction loans to acquire and repair. (conventional & FHA 203k; interest rate slightly higher)
P.S Lenders generally don't allow escrows for repairs, but when they do you must submit 3 estimates and escrow 1.5% of the highest bid.
2007-10-28 13:48:59 · answer #3 · answered by Anonymous · 1⤊ 0⤋
Yes if you can show your mortgage company that the additional proceeds will be used to improve the house and the value of the house after improvement will be higher than the mortgage.
2007-10-28 13:38:04 · answer #4 · answered by Penny 7 · 0⤊ 0⤋
You can't go over the value of the house. Say the house is selling for 250k and you're going to buy it for 250K, but it appraises at 280K. The loan could be for up to $280k. Lenders aren't going to lend for more then it's worth. The seller could increase the sales price to 280k and the extra money could be left over in the escrow account and go to you.
2007-10-28 13:20:46 · answer #5 · answered by One Bad Mama Jama 4 · 1⤊ 2⤋
Hello, concerning, your loan, first you should ask the mortage agency about his offers, Different agencies have different offers. After consultation, you would be able to choose which agency suits your demands.
2007-10-28 13:32:40 · answer #6 · answered by Zubair A 1 · 0⤊ 0⤋
Ask your mortgage broker or the bank.
2007-10-28 13:16:19 · answer #7 · answered by 2kool4u 5 · 0⤊ 0⤋
with FHA 203K you can...and limit varies
2007-10-28 13:40:38 · answer #8 · answered by Anonymous · 0⤊ 0⤋