Can't Get a Conventional Loan: Should We Pay Cash?
We’ve found a one-family house that we like, but the agent tells us it won’t qualify for a conventional loan, because of the work that it needs. Since we won’t be living in it for a while (plan to rent to a family member until we move back to NYC), we can’t get a 203K…
We’ve found a one-family house that we like, but the agent tells us it won’t qualify for a conventional loan, because of the work that it needs. Since we won’t be living in it for a while (plan to rent to a family member until we move back to NYC), we can’t get a 203K loan. The only other kind of loan we could get would be an “Acquisition and Home Improvement Loan,†which I understand is much more complicated, and more expensive, than a conventional loan.
We could pay cash for the house, but are reluctant to do that, since it would wipe out all our reserves, and we wouldn’t have enough for renovations. A mortgage broker suggested paying cash, and then getting a home equity loan in the amount we would have put down on the house, plus extra for the necessary renovations. So instead of a mortgage, we’d be paying off a home equity loan. Is this doable, or a really bad idea?
Because it doesn’t have kitchens or baths. So it doesn’t qualify for any loan, no matter how much you put down, shy of 100 percent.
Yes — also, I don’t see why you couldn’t put enough cash into the purchase to make the loan to value ratio work for the bank, then use the cash you have left to do the reno.
i dont think that you will qualify for a home equity loan…contact adam dahill who is recommended on the forum for a solution