Financing a fixer-upper
When you are about to buy a house, the last thing you want to think about is finding money to fix it up. Luckily, lenders know that many homes need work right away. They have a solution to help you afford those immediate renovations.
Financing’s best-kept secret: A purchase plus improvements mortgage
The concept is simple. You would like to buy a home, but the home needs work that you cannot afford right away. You provide the lender with a quotation for the work that needs to be done and they add it to the amount of mortgage you need to buy the house. As long as you qualify, you can afford the home and the necessary improvements, right away.
Not only can you afford your renovations immediately, you also finance them at the same low rate as your mortgage. Plus, you do not have to apply for additional financing (which can be especially hard for first-time homebuyers).
How it works
When you make an offer, make the offer conditional for extra time, as you will need to gather contractors’ estimates. You will need to submit the estimates with your mortgage application. And, if you are approved, remember that the lender will release the money for the renovations to your lawyer. Once there has been a final inspection of the renovations, your lawyer will forward the payment to the contractor directly.
We are experts when it comes to Purchase plus improvements mortgages. Call us to find out more.