Buying a home is one of life's most important decisions. That will be the place where family life will develop in the years to come. It requires making decisions with caution, taking into account family planning, and prudently projecting to define the perfect type of home for the family.
However, over and above wants and needs, money is often the determining factor. The ideal would be to buy a new property or one that is in the perfect place and perfect condition, right? The problem is that those first two options are often excessively expensive.
You can get an almost perfect home at a more competitive price, but for sure, that property will need certain repairs to be in full condition for you and your family. In those cases, your ideal option is to opt for a renovation loan. It is essential that you know the characteristics of this financial option to see if it is perfect for you.
What is a Renovation Loan?
This is financing that allows you in a single mortgage to get enough money to buy the house and repair it. The lender does not take into account the current value of the property, but the after repair value (ARV). This cost is the result of the home seller's proposal and a formal estimate from a contractor. With this type of mortgage, you can get up to 110% of the ARV, depending on the financial institution.
With this option, you will be able to acquire properties at significantly lower costs and have the resources to turn it into the home of your dreams. This type of financial option avoids the inconvenience of making two mortgages (one purchase and one repair) with their own initial costs, fees, interest, and administrative expenses. If you would like more advice about renovation loans in Denver, the Adams Property Consultants team will be happy to help you.
What Types of Repairs Can You Do?
This is determined by the lender, but renovations may include installation or replacement of air conditioning or heating systems, energy and plumbing system repairs, roof repair or replacement, among others.
Where Can You Apply for a Renovation Loan?
Conventional financiers may not be the best option. They usually have higher costs for the down payment, fees, and interest. They also tend to have restrictions on the type of repairs you can make. They also take into account aspects such as the age of the house, or the state of deterioration, since it increases the financial risk.
There are better options protected by government agencies such as FHA, VA, or FNMA that are more flexible. Because the agency guarantees the loan, homes can be purchased with better financing conditions. They are also broader about repairs, as some mortgages even allow structural repairs.
If you want to know the best options for renovation loans in Denver, you are in the ideal place. Adams Property Consultants is a company specializing in renovation loans, and we are at your service. Let us put our more than 25 years of industry experience to work to achieve the best conditions for you to buy the home you want, and repair it. You are one click away from getting the house of your dreams. Contact us.Renovation Loans Denver