Leslie,

You may also see if you qualify for a MSHDA program that allows assistance for renovations possibly including energy star appliances. http://www.michigan.gov/mshda

Left hand side of the screen under improvements

Sorry for the type 0 - Michael is correct it is 203k offered by FHA.

Good luck to you.

Seems to me there a lot of answers to your question that could and should be answered by a mortgage professional or you bank loan officer. There is a chance that if the property would appraise that you could buy the home with a first mortgage and get a second or equity loan to do the rehab. Good Luck

Yes, thank you! I have heard it mentioned before and even seen it on an HGTV program but maybe she was getting the rehab loan that Mike had mentioned. I appreciated the clarification.

Leslieroe

There are specific mortgage products that allow you to do this..FHA in particular has one (203K is the name of it). Talk to your lender, if you're approved for this you'll be able to do this--some downsides tot he 203K--pain in the butt to get approved and done, so some lenders shy away from them, and all work must be done by licensed contractors.

Leslie, that scenario you described is possible, but only with certain mortgages. You would have to get a Rehab mortgage, one example is an FHA 403K. I would recommend talking with a mortgage professional.

Hi Leslie, if I understand your question correctly, can you use $50,000 to renovate a $100,000 home? The answer would most likely be no. Your lender will only lend the amount up to the appraised value of the home.
Does this answer your question?

If you are pre-approved for a mortgage loan for $150,000 then you may purchase a house at any price up to and including $150,000 (or more, if you have additional down payment funds available). So buying a house for $100,000 is fine.