Can we get part of our home loan as cash to do repairs on the house?
Wednesday, July 22nd, 2009 at
4:15 pm
bandana asked:
A job transfer has relocated us to Las Vegas, and we’ve gotten approved for 360K to buy a house. We offered 285K on a home and would like to get an additional 25K from the home loan in order to repair the house (carpet/flooring, paint, and other repairs)
A job transfer has relocated us to Las Vegas, and we’ve gotten approved for 360K to buy a house. We offered 285K on a home and would like to get an additional 25K from the home loan in order to repair the house (carpet/flooring, paint, and other repairs)
Will lenders typically do that? What other avenues are there to get cash to repair the home?
Zachary
Tagged with: Buy A House • Carpet Flooring • House Paint
Filed under: Do it Yourself Repair
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as long as i get some.
Being apporved for 360K doesn’t mean they’ll give you 360K.
Generally – you’ll get the amount you need for the home you’re going to buy. Most banks will not give you more money than a home is worth.
In otherwords – you find a house worth 285K, they’ll give you 285K, not 310K. If you default, they’ll be out 310K, and they’ll be left holding a property that is worth less than the loan.
Typically not on the original loan, although if the appraisal is much higher than your purchase price, you might find a lender who will do it.
After you build up some equity, it’s common to be able to refinance and take some money out. Or to get a home equity loan for the repairs.
Being approved for $360k doesn’t mean they’ll lend you that much – the house has to be worth that much too.
If you cannot find financing, most larger contractors/construction firms have good financing like 1 year same as cash or other decent payment plans
Unlikely. The lender is only going to give a loan for the appraisal value of the home, not what you can pre-qualify for. There are FHA 203b loans that allow some money for repairs, maybe some of the lenders that come in here will explain that to you.
If it appraises for more than you paid, you can get a HELOC, but that will be a higher interest rate.
How about the Home Depot card that gives you one year same as cash? But that interest accumulates, and on day 366 if you haven’t paid it off, they’ll slap all that interest on your tab, so make sure you pay it off. I don’t think you can get $25,000 line of credit, but I have a $10,000 credit line. That will buy alot of home improvement stuff.
No you cant. Your home loan is only a loan to buy the house; soft money loan. Getting cash is another type of loan hard money loan: home equity loan, or home equity line of credit. A hard money and soft money loan are two very different loans. Qualifications, fees and interests are higher with hard money loans. You cant have a 2 for 1. You can ask the seller to credit money for repairs, but that’s out of their profits.
As others have told you, the loan will be based on the appraised value. It is very likely that the appraised value will not be much more than the loan, even if you find a huge bargain.
Most lender do not do cash back purchase loans.
You could investigate the possibility of obtaining an FHA203K purchase & rehab loan. That would be about your only solution, other than a equity or remodel loan after you purchase.
There is also offer a streamlined 203K (limited repairs)