I've recently had a number of people ask about how they can include planned renovations in the purchase price of a home. Niki French, the Renovation Specialist at Plaza Mortgage, was kind enough to provide me with more specifics.
First step is to apply for a Purchase & Renovate or Refinance & Renovate loan. This step will require you to provide credit documents, sign the applications and disclosures, and review a contractor's package and copy of renovation disclosures.
Once you receive the pre-approval letter, the renovation specialist will contact you to go over approval conditions.
The purchase agreement should include renovation verbiage.
Schedule inspections and verify permits can be obtained. A HUD certified consultant will help you to determine the scope of the work.
Have your contractor complete and return the contractor's packet.
Once approved by you, your contractor, and the consultant, an appraiser will determine its after improved value.
Final loan approval is issued after the scope of work, appraisal, and loan commitment conditions are reviewed and approved.
You obtain homeowner's insurance, the title is received, final figures are established and the closing documents are signed.
Renovation must begin within 30 days of closing, cannot stop for more than 30 days, and must be completed within 6 months or less.
Money is dispersed as work is completed and inspections completed.
Call me 816.560.3758 or Niki French 816.746.7360 for assistance in obtaining a renovation loan to make your dream home come to life.
