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1,375 Views | 2 Replies | Last: 4 yr ago by AggieP18
AggieP18
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I need some advice gentlemen, an 1100 square foot house near lake grapevine has come up for sale for 100K. Great area. It was built in 1963, has been gutted and reframed. Needs Sheetrock, kitchen, appliances, new electrical, AC/heat, roof etc. I'm in construction and am figuring it to be a 50-60k overhaul.

What kind of loans are available on something like that? I would figure that the bank would not typically loan on a home in that condition. I'm 24 and make 70k a year so who knows what I'd qualify for. Would it be smart to risk the 150K investment? I'm sure I could flip it for at least 215-220k all said and done. Thanks for the help.
Bonfire1996
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AG
Banks can loan on an "as complete" valuation by an appraiser. You will need to hire a a GC, have a construction contract in place, specs, budget, and draw schedule from the builder for the appraiser to make the evaluation. You will have to front all the soft costs with the GC to get to that point.

Next step is to find the bank, get approved, and they order appraisal.

Once you get an "as complete" value, the bank can loan you up to 80% of the money. There are options to go as high as 95%, but they involve third parties who would buy the mortgage from the bank. And their underwriting standards can be a bit all over the place.

A small community bank in the area will be the one to talk to. You may have to reach out to 20 of them to find someone to do it.
Ragoo
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AG
It is currently the only house for sale in the neighborhood. Why? When was the most recent sale? Houses in that area seem to be well north of 215k so what is the deal with this particular neighborhood, just old?
AggieP18
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It's old, small, gutted and needs a lot of TLC. It's a neighborhood that has several nice homes and a bunch of "ehh" homes
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