We are in the process of purchasing a home for less than value. The house is worth $204k and we are getting it for $150k. Are friends are building a new home and just want to sell this home asap… We want to remodel the kitchen and put new floors throughout. What is the best way to go about purchasing the home and remodeling? Should I take a mortgage for the cost they are selling the home to us for, plus the additional cost? So my total value on the loan would be at $180k or so… My thoughts are to purchase the home at $150k and have a loan to remodel. Is that possible to use the additional value of the home as soon as we get it or do we have to have it reappraised? Just looking for all my options without having to put them on credit cards since my cards are all less than two years old. Please let me know if you have any thoughts. Thanks.
A few options to consider.
A mortgage for $180,000 will ikley be cheaper than a mortgage for $150,000 and a home equity loan for $30,000 (or on a credit card).
I am sure it violates the term of the mortgage to have your friend give you back $30,000 after selling it to you for $180,000, so would not recommend anything that would be considered inappropriate.
To keep things on the straight and narrow ask your lender about what they would recommend.
I am aslo looking for some help in home remodelling basically for drawing room. Suggestions would be helpful!
You may want to look at getting an FHA 203(k) impotant K not B loan for the $180,000 low downpayment ie 3.5% . With the 203K you can spend the $30K on the kitchen for cabinets and new appliances. Suggestion: cabinets are very expensive consider 1) semi-custom or 2) some of the high end co have a factory story where people did not pick up their order and if it works its about 1/2 off. Take your time and learn about cabinets before you buy. Some brands are built better than others. ie particle board vs interior plywood. If you want granite counter tops shop that also. Wide price range. I spent $20K on my kitchen redo and already knew every cost cutting trick in the book. Good Luck.