Does This Type of Loan Exist?
We are thinking of buying a gutted house that would (obviously) need lots of work and months before it’s habitable. Is there such a loan these days that you don’t have to start paying back until the work is done, the old house sold and the new house moved into? Seems like this must be…
We are thinking of buying a gutted house that would (obviously) need lots of work and months before it’s habitable. Is there such a loan these days that you don’t have to start paying back until the work is done, the old house sold and the new house moved into? Seems like this must be a need that comes up all the time, but also hard to get in the current financial climate. Is this a construction loan? Anyone got a recommendation for brokers?
Thanks.
I used an FHA 203K loan for my renovation. Part of the program allows for the mortgage payments to be delayed for up to 6 months while the work is being performed. This also allows the borrower to not be burdened with rental AND mortgage payments. The 203K loan requires plans, contractor section, contractor quotes, and material selection to be done before the loan is processed so the six month duration shouldn’t be a big deal. Keep in mind the ONLY bank that now can provide a 203K loan is Wells Fargo. Keep posting with questions.
I second the FHA 203K recommendation. There are lots of conditions and it’s more costly than your typical mortgage (2.25% upfront mortgage insurance) + monthly mortgage insurance regardless of how much you put down. FHA’s website explains the details. First Meridian offers them.
If you are first time buyer looking to purchase a home as your primary residence it may be beneficial to go with an FHA 203K.
I bought a house last year and while I didn’t face the same issue you are facing now, I did face many other hardships on the road to home ownership! My mortgage broker, Harold Dubin, was there trouble-shooting with me every step of the way. I highly recommend getting in touch with him. Not to mention his rates were the best out there (I spoke to over a dozen bank loan officers/mortgage brokers) and the bank pays his fee.
HAROLD I. DUBIN
Senior Loan Officer
Mortgage Master, The Lending Experts
102 Elm Street Walpole, MA 02081 508-850-4104
888-263-1435 Ext 4104
hdubin@mortgagemasterinc.com
See my other post about Harold: http://bstoner.wpengine.com/forum/archives/2009/01/recommedation_m.php