Kk1299, Home Buyer in Potrero Hill, San Fr...

Need financing and legal help for a remodeling project. My mother-in-law is looking to finance a remodel and we'd like to contribute.

Asked by Kk1299, Potrero Hill, San Francisco, CA Tue Jan 24, 2012

The mother-in-law is the current owner. We both have a certain amount of cash available to contribute to the project but the combined amount is not sufficient to cover the entire cost of the project. With that in mind, we were wondering what financing options are available to us. Further, we wanted to understand what the best way is to structure the ownership between us and her if we do contribute money and want to condo convert down the road.

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Gabrielle Dahms’ answer
DeeDee already mentioned the 203K loan product that could work for you, depending on the details surrounding the property. Should you wish to deal with a seasoned mortgage professional right in San Francisco, feel free to call me for the referral at 415-200-7202. The same applies to a competent real estate attorney who is savvy in title issues and TIC agreements (should that be the route that makes the most sense). From your communication, it appears that you are referring to a multi-unit property. Is that correct?
1 vote Thank Flag Link Wed Jan 25, 2012
Hi Gabrielle,
Thanks for your response. You're correct, it's a multi-unit property that we would consider for condo conversion. I appreciate the offer and will indeed give you a call.

Thanks!
Flag Wed Jan 25, 2012
BEST ANSWER
First, legal help will have to come through a real estate attorny and/or a title company. The latter can provide you an explanation of the various way to vest a real estate property. I recommend talking to your respective tax consultants also. How you are going to take title and how you want to divide ownership is something that a borrower has to provide to me (as a mortgage professional), not the other way around. Now, I can tell you what will work and what doesn't, but I cannot give you legal advice.

For example, if you are going to be part of the finanaing on the property, you are going to have to be on title prior to closing of the new loan. A quit claim will accomplish that. Then financing proceeds pretty much as normal.

What is the current and extimated future value of the property (and/or expected loan amount)? A FHA 203K renovation loan could very well be the perfect loan product for this situation (and, certainly less expensive than a construction loan). However, FHA has loan limits that may not cover your project (around 729K in the Bay Area). If your projected loan amount is within FHA paramenters I can provide volumes of information about the 203K (either via blog posts or phone call). The program is not that complicated, but there are too many variables to cover in a advice forum. Just let me know if you want further info on the program.
0 votes Thank Flag Link Tue Jan 24, 2012
Thanks Dee Dee,
I appreciate your detailed response. Unfortunately, this project wouldn't qualify for an FHA and we'll probably need to indeed involve a tax consultant. I will circle back with my family and let you know when and if we do pursue financing options.

Thanks.
Flag Wed Jan 25, 2012
Thank you very much for the "Best Answer" affirmation, I sincerely appreciate it! If you have any further questions about FHA 203K program. Best of luck to you!
0 votes Thank Flag Link Tue Jan 31, 2012
You should check out the pretty awesome school maps on Trulia.
http://www.trulia.com/real_estate/San_Francisco-California/s…

You can just stay in one place and do all your research on trulia!
0 votes Thank Flag Link Mon Jan 30, 2012
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