Property Q&A in New Jersey>Question Details

Mark Risoli, Home Owner in New Jersey

Question regarding Home Equity L.O.C. & Loans

Asked by Mark Risoli, New Jersey Fri Jul 1, 2011

When applying for a Home Equity Line of Credit or a Home Equity Loan, the bank or mortgage co. will have someone appraise the value of the property. Here's my question... "Is the property appraised on the present value of the home or the future value of the home after the expected modifications are made, i.e. new bath, increased sq. ft. etc. "

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Answers

3
The present value always.

Jane
http://www.RealTerrific.com
0 votes Thank Flag Link Fri Jul 1, 2011
Mark,

A friend of mine just went through the same thing. They opted for the 203K loan so they can renovate the home and add additional bedrooms and baths. The appraisal for the future value came back lower than they had anticipated but all worked out in the end.


Good luck,

Gina Chirico, Sales Associate
Lattimer Realty
0 votes Thank Flag Link Fri Jul 1, 2011
The property is appraised on the present value of the home.
Home Equity Line of Credit or a Home Equity Loan is based on the amount of equity you have in the home. If you want to do renovations you might want to look into refinacing the home with a 203K loan. If you need 25K worth of upgrades you can roll that amount into your new mortgage and then YES the appraiser will use the worth (Value) of the home after the work is done.
It's a nice program... and Home Equity Loans are hard to come by right now.
Robert Baglione
Re/Max
0 votes Thank Flag Link Fri Jul 1, 2011
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