Posted: Sat Jan 20, 2007 12:30 am Post subject: Can I borrow more than what I will pay for the house
I am a first time home buyer. I was looking into pre forclosure or bank owned homes. I was wondering if I can get a $200,000 loan even though I plan on only spending $160,000-$170,000. The extra money will be for whatever improvements are needed. The market value will be between $200,000-$250,000. _________________ Need help choosing the right loan? Get free consultation from community lenders/consultant
Posted: Sat Jan 20, 2007 12:51 am Post subject: RE: borrow more than what to pay for house
Welcome Cannoliwithlegs.
I think it's possible. But it will depend on the lender. Did you tell lenders about it? _________________ Procrastination is the enemy of your financial sucess
Posted: Sat Jan 20, 2007 3:10 am Post subject: RE:L home purchase loan along with home improvement funds
Hi Cannoliwithlegs,
There are lenders who offer loans for purchase of a new home along with improvements on it. I have heard that Fannie Mae approved lenders offer such a program known as the HomeStyle Mortgage. This type of a product provides 90% financing to all borrowers of all income level. The loan amount is based on the "as-completed" appraised value of the home and around 50% of the value for improvement on the home.
The best thing about this loan is that you can do any kind of repair work o your home using it and that too at low mortgage rates. There is no need to go for a second loan as many people choose while going for repair work on their homes even after getting a first mortgage.
The properties eligible are 1 - 4 unit homes, condominiums and planned unit development units. You can qualify maximum for an amount within Fannie Mae's conforming loan limit. The loans can be fixed rate or ARMs with rate caps for a loan term equal to 15 to 30 years.
Posted: Sun Jan 21, 2007 11:06 pm Post subject: RE: approved loan amount
Hi Cannoliwithlegs,
Your loan amount will depend upon the home appraised value or purchase price, whichever is lower. If the appraised value is worth $200,000, then you may get around 80-90% of the value as the loan. That is the maximum value and if you do wish to spend lower than that, then you may inform the lender as to how much you wish to borrow.
You can just ask the lender if you can qualify for it. He will evaluate the documents you submit and then let you know the probable amount.
adonis
