4509 Veterans Blvd., Ste 200
Metairie, LA 70006
Rebuild The Dream
A Home Buyers Strategy for Purchasing
Bank Owned Properties
This foreclosed 2-unit home is in fair condition with some renovation already completed. It’s currently listed for $89,000 and the Zillow estimated value is $132,100. Home values in the area support values between $70 to $258K with a prominent value of $155,000K for properties in average to good condition of similar amendities. If I were your Buyer’s Agent I would assist you in making an offer on this or a similar house and ask the bank to provide Seller Concessions to assist you in the home buying process.
However, before we began any home shopping I’d refer you to an experience FHA 203K Mortgage Planner who could get you pre-qualified for a renovation loan that allows for 100% of your renovation cost to be included in the mortgage. This would include the purchase applicances, completing the necessary interior and exterior trim, painting, installation of the two separate air conditioning and heating systems and any general improvements you’d like to include to make this house your home. If your offer was accepted I always recommend a home ispection by a State Licensed Property Inspector to complete a comprehensive list of needed repairs to insure, you and I hadn’t missed anything and to insure your house was home ready before you and your family moved in.
Next we would consult with at least three Licensed Home Improvement Contractors to provide estimates of repairs based on property inspectors evaluation and include your wish list of improvements, since the primary objective is to turn this bank owned house into back into a home. These can include, but aren’t limited to updated kitchen appliances, new bathroom, flooring, carpeting, interior and/or exterior painting, roofing, new central air conditioning units, energy efficient windows and doors, as well as many other energy efficient items and general improvements to create a wonderful home with lots of curb appeal.
Of course the reason you are most likely looking at purchasing a bank owned property is because of the below average home pricing they offer in today’s market. So remember, keeping your home improvements within a reasonable budget should be as much a part of your consideration as creating a home for you and your family.
In my assessment (yours could be different) of what’s needed to make this house a home is approximately $25k to renovate cost to classsify this home in avergage to good condition. So we have a purchase price of $89K and $25K in repairs, creating an adjusted cost of $114k with and expected after improved value of at least $155K by following the FHA 203K Renovation Strategy and advise of an FHA 203K Consultant. To insure we are on track with your goals of creating a home for your family and position you to enjoy a substantial equity position your Mortgage Planner will secure an FHA appraisal based on an after improved value.
While your mortgage planner and I are assisting you in bringing various professionals together, your mortgage planner will be working on getting the application approval. Once we have approval (usually withing 60 days) of the seller signing the purchase agreement, you’ll sign all the necessary documents to transfer ownership and once you have signed your closing documents all you have to do next is get your contractors on site to complete your renovations.
After the renovation was completed to your satisfaction a final inspection will be preformed by you and your FHA 203K Consultant to insure a workmanship like manner of services and your lender will issue final payment, update title and clearing all liens associated with the renovation your contractor might place on the property.
So lets recap what you’d get if I were your Buyer’s Agent in this or any bank owned property transaction.
I would help you make an offer based on an in-depth evaluation of the property and it potential equity appreciation.
- I would introduce you to qualified home inspectors, contractors, consultants and mortgage planner to provide you with an indepth assessment completion of necessary improvements, as well as work with you and your lender to secure the best mortgage terms possible.
- Most of all I’d guide you through the FHA 203K renovation strategy and always be looking out for your interest with the goal of maximizing the most bang for your renovation buck to make this or any bank owned property a home again.
With just a 3.5% down payment and 100% of the renovation cost financed in your mortgage or just over $3100 for your down payment your mortgage planner can structure a mortgage for about what your would pay to rent a home and what’s really nice about this property is you’ll have a rental unit to help offset your mortgage payment.
After you completed the renovation you’d have a house you could call home and could easily see a substantial appreciation by using the FHA 203K Renovation Strategy, just because you used me as your Buyer’s Agent!
Call me or send me an email on any of the neighborhoods you’d be interested in finding bank owned listings and I’ll be more than happy to do some research for you. Until them if you’d like to simply do some window shopping here’s some websites I’ve preselected of foreclosures in New Orleans area.