Most people want a home where they can just move in, unpack and start cooking their Shabbat meal. However, many are finding it hard to win a move-in-ready home in this current market. In some cases, even increasing the price or putting forth a cash offer with no mortgage contingency isn’t getting a person the home they want. There often seems to be someone a single step ahead in this fast-paced market. This situation feels a lot like Chanukah when there’s a really hot toy that every kid must have, and you simply can’t figure out how to get your hands on it.
More and more people are coming to the realization that it can be easier to buy a house that needs a little more work and love in order to compete with fewer offers. The willingness to purchase a home that needs vision and foresight can help you avoid having to stand in line with everyone else competing for the “Class A” house. It also offers the benefit of being able to create your dream home rather than settling for the finishes, materials and designs a move-in-ready home offers.
The solution: Become the builder. Find a home that others aren’t competing for and renovate it. You can turn it into the house you want it to be while making sure it still fits your budget.
Home improvement projects can be intimidating. You might feel that you don’t have the funds to both purchase the home and do the renovation. However, there are financing options available that can allow you to do both at one time.
Renovation loans allow the buyer to borrow an amount based on the “as completed value” of the finished home rather than the purchase price. For example, if you pay $400,000 for a home and spend $200,000 to renovate it, you may be able to borrow up to 95% of the $600,000 total value, provided the improvements are supported by the subject-to-value appraisal. This option does require both patience and foresight, but at the end of the day this may be the best way to find the home you want without overpaying. Overseeing a renovation is not for everyone, but it can be an amazing experience to help you find the home of your dreams.
At Guaranteed Rate Affinity, many of us have extensive experience with renovation financing, and we can help in the process. We can work alongside real estate agent partners who are specifically searching for properties that may be candidates for renovation. This loan product is also available for investors who would like to buy, fix and rent or flip.
Please reach out to me if you would like to explore this possibility, as well as different approaches to get the results you’re hoping for and a home at a reasonable price. Become the builder of your own home and take control of a large portion of the home buying process.
David Siegel is a vice president of mortgage lending with Guaranteed Rate Affinity (GRA), a leading national retail mortgage lender. GRA is licensed in all U.S. states except Hawaii, and works with many investors, which allows it to provide competitive pricing and a broad channel of unique options to handle the often very specific needs of the community. David has over 15 years of experience at both major banks and mortgage bankers and understands the guidelines of different lenders to help direct his customers to the best loan type for their needs. No one lender is the best option for everyone. David will help you find the right choice for you. He is located at 16 Arcadian Avenue 3rd Floor, Unit C-6, Paramus, NJ 07652. Contact him via email [email protected] or phone 201-725-9527.
NMLS 277243 Guaranteed Rate Affinity NMLS 1598647 Equal Housing Lender.
For licensing, go to nmlsconsumeraccess.org, 16 Arcadian Avenue, 3rd Floor, Unit C-6, Paramus, NJ, 07652. Licensed by the NJ Dept. of Banking and Insurance.
Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. Receipt of application does not represent an approval for financing or interest rate guarantee. Restrictions may apply, contact Guaranteed Rate Affinity for current rates and for more information.
