How to Fund a Remodeling Project
Depending on your budget, it may make more sense to buy a fixer-upper as opposed to a house that is already to your standards when you move in. Fixer-uppers are generally less expensive to purchase because they will need one or more repairs or upgrades. The good news is that there are mortgage products available to help finance these repairs or upgrades.
Apply for a 203(k) Loan
A 203(k) loan is an FHA mortgage product that provides enough money to cover both the purchase price of a home as well as the cost of any upgrades. As with any other mortgage product, you will need to be able to meet minimum credit and down payment requirements. Typically, you will need a credit score of at least 580 and a down payment equal to 3.5 percent of the loan amount.
Ask About a Piggyback Loan
A piggyback loan allows you to reduce your down payment without the need to make mortgage insurance payments. In most cases, you will apply for a mortgage that covers 80 percent of the purchase price. Then, your lender will create another loan that covers half of your down payment obligation. In most cases, cutting your down payment in half could allow you to keep thousands of dollars in your bank account. That money can now be used to make repairs to your home.
Explore Your Options Before You Submit an Offer
You can get more information about loan options by going online or speaking with a mortgage company in Las Vegas. Prior to applying for financing, you can see how much you would need to put down as well as the interest rate on any loan that you qualify for. This allows you to make an educated decision regarding a purchase that you will likely be paying for over the next several decades.