Purchase home for cash but finance repairs?

[Mellochick]

Is there even such a loan like this available? Like if I purchase this home that's listed for $44,900 for maybe $10,000-$25,000, then do a loan solely for the repairs on the home? Yes I know $10,000 is a low figure and it's a long shot, but they didn't winterize the foreclosure this winter, so we truly have no idea of what kind of damage we are dealing with and neither does the bank or realtors even. I was just wondering if this type of loan is even a possibility and what it is even called?? Anyone know? I would only need a loan for maybe $30,000 tops we're hoping.

[StartingOver10]

They still put a lien (a/k/a mortgage) on the property for the amount of the loan. So in effect you would be getting a small mortgage and using your cash to repair. Sounds like you are short just $10k to $30k.

Not likely to find any bank at all willing to do this kind of loan.  But you can get a hard money lender or private lender and they do these types of loans all day long. Short term loan until you get the repairs done. Then you  can refinace with a regular lender for a primary residence.

Edit:  Also check local community banks in your area and credit unions in your area. They are more likely to do the small loans and then you don't have to deal with the hard money lenders. The exception would be if the small bank has requirments on condition of the property - then you would have to do the two step process as mentioned above.

[Mellochick]

Do you know of any lenders who do any rehab loans with a score of around 580 for a loan under $50,000?

[StartingOver10]

---

@Mellochick wrote:

Do you know of any lenders who do any rehab loans with a score of around 580 for a loan under $50,000?

---

The only lender that I can think of is a hard money lender. They don't care about your score at all. They will usually only finance up to 65% of the value of the house. The rates are higher (in the 12% range right now) and they require a short term loan (some will go a year or two at most). Then you would need to refinance.

Did you check local small lenders in your area yet (community banks and credit unions)? They have something for small dollar amounts.