Myth Buster of the Week: The only way to pay for improvements on your home is through a home equity line or construction loan. FALSE!
Fannie Mae has a home repair loan for adding on or fixing up. I recently had clients who wanted to sell their home for top dollar. Their realtor suggested some small upgrades to kitchen and bathrooms, in addition to adding 200 square feet.
This would add $120,000 to the value of their home, and make them more competitive in today’s buyers’ market.
After getting bids, they found out it would only cost $60,000. They were thrilled but when they looked into a home equity line, the bank turned them down because the current value of their home wasn’t high enough; they owed $400,000 on a house that is currently worth $475,000.
The realtor referred them to me, and I was able to get them a rehab, no cost loan, that would use the FUTURE value of the home. This gave them plenty of room to get the money to do the repairs, and at a great rate. Thinking of doing upgrades? I can help!