Extra funds for home loan that is not used

Asked by Amanda T, Norfolk, VA Sat Mar 30, 2013

If i am interested in buying a home that is sold "AS IS" priced at 130k that may need minor but many repairs, Would i have to apply for a different loan for funds to to use towards repairs or could i use my initial loan that i was quoted and can receive for buying the home.. Meaning if i was told i could get 190k and the home is 130k could i use the remaining funds for fixing on the home?

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6
April Ford, Agent, Norfolk, VA
Wed May 15, 2013
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0 votes
Kevin Monette, Agent, Virginia Beach, VA
Mon Apr 1, 2013
Not up front you could not in most cases, however after you close on the home you could draw from the equity and make upgrades to the home.
In most cases, I would recommend a 203K loan, but most agents do not tell the clients, that this is going to get you the "lower grade" repairs/updates. For example if you want Stainless Steel appliances, you may only be able to get the white /black ones. SO there is good and bads with this type of loan.
Connect with one agent and one loan officer and get the plan together and as a team you will be able to approach this with professional assistance and make it happen. Let me know if I can do anything for you. Thanks for the question.
0 votes
Michael Harr…, Agent, Norfolk, VA
Sat Mar 30, 2013
Hello Amanda Todd,
Anthony Alleva, Don Tepper, Ron Thomas and Lowell Sterling, gave you great answers. I have been extensively educated by several mortgage companies concerning their 203(K) loan programs. In the scenario you described above, you could likely be an ideal candidate for an FHA 203 (K) loan. Generally you would buy the home for $130,000.00 and use the $60,000 for repairs, kind of like what you stated above. There are too many variables which may need to be considered for your unique situation; such as how much money would it cost in repairs for the property to meet the minimum property standards for an FHA loan. Or such as whether or not the property already meets the lenders minimum property standards. In that case all the money ($60,000.00 in repairs) could possibly be used at your discretion. I would love to discuss your situation with you more fully. Please feel free to contact me if you have any questions or need further assistance

Thank you so much,
Your Realtor Michael Harris
Long & Foster Realtors
2000-13 Colonial Ave
Norfolk, VA 23517
Cell: 757-672-1346 Email: michael.harris@longandfoster.com
0 votes
Anthony Alle…, Agent, Riverside, CA
Sat Mar 30, 2013
You would need to apply for an FHA 203(k) loan that will allow for the loan amount dollars to be applied to repairs. Give me a call at 800-215-0211 and I would be more than happy to explain it to you.

Best Regards;
Anthony Alleva, CSSA
Certified Short Sale Agent
REO REALTOR®
License #0225-205922
Allison James Estates & Homes
601 Dinwiddie Street
Portsmouth, VA 23704
Toll Free (800) 215-0211
Email: info@anthonyalleva.com
Website: http://www.AnthonyAlleva.com
0 votes
Don Tepper, Agent, Burke, VA
Sat Mar 30, 2013
No. Not with a conventional loan.

However, there are FHA 203(k) loans that include both the purchase and rehab amount. So, there are loan products out there (there are other ways to do it to) so that you're borrowing for both. Even better: The amount you can borrow is based on the after-repair value--the fixed up value--of the property.

A good lender can give you more information.
0 votes
Ron Thomas, Agent, Fresno, CA
Sat Mar 30, 2013
There are several loans that could do that for you, if you qualified.
The Contractor is paid out of the Escrow, and they will have special inspectors keep watch.
0 votes
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