Quote:
Originally Posted by Kolyan2k
So I know you can get mortgage for land + new construction and start paying that when house is built. Does it work the same with large renovations? Say I buy some shitty house for 200-300k and then spend another 150-250k for renovations, is there a mortgage that would allow me to start paying when construction is done?
My mortgage guy in on vacation
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You can get a renovation construction loan based on the estimated final value of the renovated house. Expect some administrative overhead, though, same as you would have for a construction loan on a new house. The lender will put some fairly stringent controls and verification measures on the process, to secure the value of the asset they're lending against. They want to make sure you don't exhaust the funds and end up with a half-finished house that has a blue tarp covering the whole roof and no windows in it, since the home in that state would probably be worth even less than it was when you started. They're going to mitigate their risk exposure, same as you or I would.