Looking back it’s clear we have had a lot of great renovation loan projects so far this year! Renovation loans are so versatile that they can be used for purchases, refinances and even singular items. Let me share with you some examples of some recent projects and how the loans can vary.
Location: McKinney, TX
Purchase Price: $266,130
Renovation Total: $41,282.85
After Improved Value: $300,000
What did they do…
This couple searched for a couple of months and then decided just to purchase the home they were renting. Luckily for them the owner was willing to sell so it worked out across the board! Using the renovation funds from the full FHA 203k loan they were able to:
- Add Energy Efficient updates to the windows, insulation and doors – this allowed them to exceed the FHA loan limit by $8000!!
- Repair the foundation
- Update the electrical
- Update the kitchen and living areas – fresh paint, new floors, appliances, etc.
- Remove the fireplace to open up the areas
- Repair leaks in plumbing
Location: Euless, TX
Purchase Price: $131,000
Renovation Total: $20,275
After Improved Value: $155,000
What did they do…
This home was perfect in every way except…the pool needed a lot of work and the previous owners decided to do some demo in the kitchen. Guess what? The buyer of this property was able to purchase the home “as is” using the Fannie Mae HomeStyle loan and not only repair the kitchen but design a great outdoor living space complete with a fully functioning pool!
- Repaired door and electrical in kitchen
- Resurfaced pool
- Updated electrical for pool and spa
- Added a diving board and slide
- Updated title and decking around pool and spa
- Installed new pool equipment
After reading about the two projects above it’s clear that a lot can be accomplished with either the FHA 203k or the Fannie Mae HomeStyle renovation loans but what options do you have if you just need a singular item replaced or repaired? The short answer is…several!
Take for instance our clients who closed last month in Austin, TX…their home only needed a septic system. After all of the bids came in it appears this project was going to cost about $20,000. They opted for the Fannie Mae HomeStyle loan which allowed them to install the septic and finance the cost of the repairs. The nice thing about their project was being a singular item, they didn’t need a consultant and the appraiser simply listed the repairs in his report.
Another example of some minor repair work comes from our client in Allen, TX. He was able to close with an Escrow Holdback that the seller funded. Basically the seller provided funds on the HUD-1 statement which we held in escrow. Once his painting was complete and his new granite counters were installed we simply sent the original appraiser out to inspect the work. Then we paid the contractors out of escrow.
As we continue to say, each renovation loan is unique but luckily we have a program for them all. We will customize the renovation loan to meet your needs! Give us a call today and let’s talk about a program that will best fit you.