BUYING AND IMPROVING A HOME

Some prospective homeowners have home improvement needs even before they close on a property. Perhaps your dream house needs a few structural repairs to make it safe for your family to live in. Or, maybe you've found an older home that has great potential but needs your special touch.

In many instances, it is easier to undertake remodeling projects before you move in or during the first few months of homeownership. This way you can work through the disruption and mess before you unpack all the boxes and get too comfortable in your new space.

Before applying for a home improvement loan, decide whether the house you are considering is a solid investment. Is it in a neighborhood with good schools and stable or increasing property values? Will the improvements add value to the house? Also, think about how much time the remodeling will take and how it will affect your lifestyle.

Through lender partners, Fannie Mae offers a mortgage product that lets you get one loan that includes funds for both buying the property and making improvements shortly after purchase. The amount of a purchase-renovation mortgage is based on the sales price of the home plus the needed amount for home improvements, as well as your capacity to repay the loan. You are able to pay for your home and renovation costs with just one monthly payment.

The amount you can borrow to purchase your home and finance improvements will usually be based on the purchase price, the value the planned improvements will add to your property, and your ability to repay all your debts. Certain mortgage loans limit the total amount of renovation that may be financed. Therefore, before you start drawing up contracts or construction plans, you'll want to make some preliminary estimates of how much your planned improvements will cost and how much they will add to the resale value of your home. An experienced renovation lender (many work closely with Fannie Mae) can help you through this process and give you an idea of how large a loan you can afford and the type of loan appropriate to your situation.

GETTING STARTED
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If you have questions or would like to speak with me, please give
me a call at 888.691.0151 or drop me an email at dave@lenderdave.com.