I’m about to make an offer on a house that needs a lot of work. There’s wood rot, peeling paint, and overall poor maintenance. The price is around $425,000, but with renovations estimated at $175,000, it should appraise for around $625,000 once everything’s done. Since this is my future home and not an investment, I’m looking for the best financing options to keep costs and hassle down. Any suggestions on how to move quickly and efficiently?
Of the $600k total you need to spend, how much cash do you have vs. how much will you need to borrow?
I have enough cash to cover 20% of that.
You might want to consider an FHA 203k loan. Just keep in mind that renovations often cost more than estimates. If you’re already at $425k plus $175k, what’s the plan if you go over budget?
Wait, just to clarify: you’re planning on buying a $425,000 house, then adding $175,000 in repairs? That’s $600,000 before taxes and fees. Why rush into what sounds like a potential money pit?
Have you considered getting a home inspection first? That might give you a clearer picture of what you’re up against and how to budget for it.