thanks everyone for your comments. useful points about the financing part.

when i say 'gut renovation' i mean there is nothing habitable - or even salvagable - from the interior so it would need to be removed and totally done over. it is not currently safe to go upstairs, and barely safe to walk around the ground floor. i would want to make it a single family - so only one kitchen, for example, not 4 separate units.

does anyone know anything about the small building loan program offered by HPD for rehabilitation jobs?

Posted by: el_salar at March 31, 2008 5:18 PM in response to Tips before buying a shell?

Thanks for all the great feedback everyone and particularly the Easyfloor recommendation. Did you work with a contractor to install or did Easyfloor do it? Who advised you on the best types of wood to use with radiant heating for your flooring?

Posted by: el_salar at April 2, 2008 4:29 PM in response to Radiant floors

I am currently looking to buy in Harlem, and I spent a lot of time researching financing options for a house that needed a gut reno. I would recommend that you contact Wells Fargo - they have a unique product that combines a mortgage loan with a renovation loan - all with one closing. This is the only bank I am aware of with a product like this. It will be hard to get a loan otherwise for a place without a C of O. Good luck!

Posted by: el_salar at July 15, 2008 3:57 PM in response to Financing? How do you do it?

Here is a contact at Wells Fargo per the mortgage + renovation loan package:

Marsha Morency
Home Mortgage Consultant
Renovation Specialist
Wells Fargo Home Mortgage
M6534-031
75-20 Astoria Blvd., Suite 130
East Elmhurst, New York 11370
718-310-4343 Tel
866-201-5006 Fax
marsha.morency@wellsfargo.com

Posted by: el_salar at July 17, 2008 5:03 PM in response to Financing? How do you do it?

Thanks very much for your feedback. Yes, the house is vacant with a valid cert of non-harassment through the end of 2009.

I have since spoken with an expeditor, who gave me a ballpark estimate of $10K for the full job of delivering a new C of O (including getting the drawings done by a licensed architect). That seems to be the going rate discussed on other parts of Brownstoner.com. Would you say that is reasonable?

Posted by: el_salar at July 22, 2008 4:48 PM in response to Conversion of SRO to one-family

I spent a lot of time researching this issue in the past 6 months in anticipation of buying a house in Harlem, and I would second what everyone has said above. You can't get a traditional mortgage, you will need a construction loan, which typically comes with a higher interest rate. (you also might want to look into wells fargo's renovation loan program, which combines a mortgage with a construction loan into one closing)

And you definitely cannot gut renovate a shell these days for less than $500K, and that is not doing anything fancy. Plus, be sure to educate yourself on the complicated zoning issues you will also encounter concerning SRO's and certificates of no harassment, etc, which can add to the costs, timeline & effort.

You might find, as we did, that it will be less expensive in the end to find a livable 'fixer-upper' rather than a shell.

Posted by: el_salar at July 23, 2008 4:55 PM in response to Brownstone Shell question

P.S. In general, we found that houses in Brooklyn were often less expensive and in better condition than in Harlem.

Posted by: el_salar at July 23, 2008 4:57 PM in response to Brownstone Shell question

While it may be that large windows and skylights require an additional form of heat, I found it most interesting to find out in answers to my questions above that your typical Brookyn attached house (which tend to have large windows, but with most of the exterior walls attached to the next house) can be heated well with radiant heat. I didn't know that.

And, while what Master Puvmber says may be true, it may not be as relevant if you own a brownstone-type attached house, rather than a stand-alone Victorian or a house in the burbs. The type of house one is talking about clearly matters.

Posted by: guest at April 3, 2008 1:15 PM in response to Radiant floors

You're right about that.

It generally takes less energy to heat our attached homes than any free standing structure.

Posted by: Master Plvmber at April 3, 2008 5:28 PM in response to Radiant floors

Definitely use a broker. . . they get paid if you get a loan, by the bank, not you.
That said, it sounds like you are kind of in over your head anyway, especially in this market.
There's a reason why you should have a hefty downpayment for a project like this.
A lot that can go wrong and the bank doesn't want to be holding the bag when you screw it up or . . . it takes longer than you think to get any cash flow.

Posted by: ontheparkway at July 15, 2008 4:02 PM in response to Financing? How do you do it?

Please you Asshats, buy something!! I hope you buy a house you fucktards!

The What

Someday this war is gonna end..

Posted by: what at July 15, 2008 4:04 PM in response to Financing? How do you do it?

when we bought we took a mortgage for 80% to purchase. then took a second mortgage for 10% (at a higher rate) for part of the renovation and paid for the rest of the reno using new credit cards with 0% interest for 12 months. managed to finance $200K in construction. avoided having to get a construction loan. and could have refinanced once it was finished since it was worth more but so far haven't done that. the credit card thing is risky i guess, but it worked for us and was less pain. managed to get our gut reno done and have tenants in within 3 1/2 months of closing on a building that had been used as an SRO. So i'm not sure I agree with ontheparkway about you being in over your head... don't know how they can know that without knowing your situation much better

Posted by: 11216 at July 15, 2008 4:08 PM in response to Financing? How do you do it?

The American financial system is in meltdown and you STILL want to buy a house??!! I am convinced the American citizen is a brain washed dumbassed morons and there is no help for them.

Read this:" I try to be upfront with my financing needs but I am finding a lot of different loan names for the type of loan I need vs what lenders are willing to offer. I see all the renovation occuring around the neighborhood and I am wondering - how the heck are you getting financing and who are you using?"

No one is using any one, you can't get a mortgage now

"Thus far WAMU does not handle these types of loans, "

WAMU will be done in about 2 weeks. They are insolvent and looking for a buyer.

" SunTrust recommendation is no longer with the company, Commerce wants to do a commercial loan with a sizeable downpayment, Bofa has had no response and Chase wants an arm and a leg just to fill out the application."

The system is on life support and 2009 will be a bad year...

The What

Someday this war is gonna end..

Posted by: what at July 15, 2008 5:32 PM in response to Financing? How do you do it?

Thanks all for the advice.

@el salar - I will definitely check out Wells Fargo.

@11216 Good suggestions. I was thinking of something along those lines using the equity in my current properties that I don't have mortgages on and using the rental income so I won't have to much of a noose around my neck. I know cc's are risky but it's a good back pocket option.

& ontheparkway - thanks for the response. not in over my head and need to make sure i stay that way. trying to paint the financing picture before I make any offers on the property. I learned my lesson early on that issue. Just trying to gauge the financing landscape since it's changed so much since my last purchase in 2004.

@denton & bricktar - I'll check out the mortgage broker option after i check in with Wells Fargo. I used a broker the last time and ended up with an indy mac loan. I was kicking myself because I could have gone directly to the bank.

@ the what - brother i hear you on all points and trust, I am not making any decisions without considering every possibility.

Love the opinions - keep 'em coming. Thanks.

Posted by: couldashouldawoulda at July 15, 2008 10:24 PM in response to Financing? How do you do it?

Seriously, call Brian Scott Cohen from Wells Fargo he be very honest with you and tell you what can be done. He does not charge an application fee. He hooked up our loan and we had a 500k commercial loan he did for us went smooth as can be

Posted by: Thedish at July 15, 2008 10:30 PM in response to Financing? How do you do it?

Seriously, call Brian Scott Cohen from Wells Fargo he be very honest with you and tell you what can be done. He does not charge an application fee. He hooked up our loan and we had a 500k commercial loan he did for us went smooth as can be 718 780 9132

Posted by: Thedish at July 15, 2008 10:30 PM in response to Financing? How do you do it?

try Wells and a Broker so you know Wells has the availabilty to broker out as well. I tried the guy above Brian Scott Cohen as Well his service was insane, but he could not do our loan, but definitely recommend him. We needed no income verification on a 4 family Jumbo...He may help you 718 n780 9132 or cell 646 584 8009

Posted by: VfromR at July 15, 2008 10:35 PM in response to Financing? How do you do it?