Asked on Mar 23, 2014
Major problems, need advice please
+21
My house is falling apart. I want to see about refinancing and "cashing out" to have the repairs and remodeling done. I don't know where to start! Still owe 24K on house probably worth 60K at best. Everything needs repair. Have some structural damage as well. Not looking to for granite and SS kitchen with oak cabinets. I just want a home that is livable and I could have company in. I don't know where to start! A few years back I spoke to my bank about a mortgage and they said no. Took photos and I heard comments about my shower curtain with the skull and crossbones theme which I no longer have. They said the only way they would consider anything was if we hired everything out with their approval. I walked out the door. I can see hiring out most things but I can paint, I can lay carpet. There are lots of thing I/we can do without having to pay someone to do. I am hoping we could refi for 80K at most. Any words of where to start? I'm confused and depressed. It's like there is no way out.
10 answers
-
@InNeedOfGuidance: The first thing that I would do is have a contractor come in and give you an estimate for all of the work you believe needs to be done. Then figure out how much of that work you can realistically do yourself, or have friends and family help you with in terms of free labor. I would then go to another bank with the proposal for a refinance, and see what they say. Best of luck and keep us posted. Slow wins the race, and there is nothing you cannot overcome!
Edward Cogan
on Mar 24, 2014
- See 1 previous
-
Ed has given good advice. You need to have a professional inspect your property and give you a checklist of 'to-dos' just in case you have some major issues to be addressed. A bank is not going to loan you more money than the home is worth plus you have pay for an appraisal (which the bank will most likely insist). There are home equity lines of credit which is for this kind of thing. You can do some leg work yourself by going online (most counties are online now) and search what your property as well as neighbors' homes are assessed at. Then check out sales in your area and find comparable homes to compare-same square footage, same number of bedroom and bathrooms, yard size, garage, etc. You have to compare to a house very similar. You could start now by doing little things-patching holes, painting, cleaning, etc and making your own checklist for each room what needs to be done. You should tackle one room at a time! I know from experience this is important! Start with rooms that need little help because the more you accomplish the more you will keep going. I have renovated many homes in my lifetime and you need to have patience and a goal for each room. Good luck...pictures would help. So maybe post one pic of a room which to start such repairs and painting and some new decor.
The Garden Frog with C Renee
on Mar 24, 2014
- See 2 previous
-
Pictures would definitely help. You mentioned you need to do structural work. Focus on that. The cosmetics can come later but if the house is pretty but not sound, you won't get what you want for it anyway. Get at least 3 quotes on the structural work and take them to a couple of banks and get the financing options they are willing to offer, then take those back to your bank and see what they will do to keep your business. No bank will lend more than the house is worth, so forget that. Once the structural work is completed, get your assessed again and then ask for a line of credit to complete the cosmetics. The STRUCTURE IS KEY.
Katie
on Mar 24, 2014
- See 2 previous
-
@The Garden Frog with C Renee has given you a lot of really good information. I'm sorry you're going through this. I really understand the stress you are experiencing. It sounds like you have a really unique house that needs some love to bring it up to its' potential. The most important thing is to have a contractor you can work with. I spoke with 5 before I found one I was comfortable with. Talk to people you know who've had work done on their homes. If you don't know anyone, then when you meet with contractors, get references from them; go by the addresses and speak with the home-owners. When you find the right contractor, make sure they write up a detailed contract and a schedule payment. Do not pay more than 20% at a time. Ask lots of questions about what they are doing and you aren't comfortable with something they are doing/or didi, get a second opinion. Make sure any "surprises" aren't surprises. In other words, if the contractor uncovers something unexpected, he/she should be calling you BEFORE they change/fix it. Whatever the agreed to cost is, you should have at least a 10% - 15 % contingency reserve for those surprises. Your contractor should also be insured. I wish you the very best and would love to see before and after pictures!
Katie
on Mar 24, 2014
-
Oh boy. I'm sorry you're going through all this mess. Have you spoken to your local Community Action or Housing Authority ? I don't know where you live, but most states have agencies that can possibly help you get the house up to code, for a grant (free money) or a low cost loan. There are also places like "RE-COVER", run my agencies and volunteers who will help do repairs as needed to make your place safe, warm, etc. I'd start there. Look in the phone book, or talk to your local state assistance agency. You could also find a reputable contractor who can give you a quote for the necessary repairs...health and safety issues. He might know of ways to fund the repairs. Do you belong to a church ? many churches will help by having local folk volunteer to do home repairs. Good luck to you. :)
Jossi
on Mar 24, 2014
-
I would start by talking to neighbors and friends that perhaps have had work done. A contractor cannot tell you what you can and cannot do. If you feel comfortable painting and laying carpet, then you paint and lay down the carpet. Whatever you do, make sure you use a licensed contractor and get references. Also do a Better Business Bureau check and see if there are any complaints against him. Good luck - it's all going to work out.
Edward Cogan
on Mar 24, 2014
-
Hey Hon. I feel you. FHA has a 201k loan. You refinance your existing mortgage along with your proposed work. The mortgage company can approve "sweat equity" - doing some repairs yourself. They may even add repairs that you have missed. It is a great program. My nephew used one to rehab his home to make it handicap accessible. Go to HUD.GOV and type in 203k in the search or try this link http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/203k/203kabou You can also go to a housing counseling agency that will walk you through the loan and all the processing. HUD also has a list of approved housing counseling agencies.
Interiors by Gail
on Mar 25, 2014
-
@InNeedOfGuidance - We all wish you nothing but the best. Interiors by Gail has given you excellent advice, as have many others. It sounds like you have some renewed energy and a more positive outlook. Good luck and please keep us posted.
Edward Cogan
on Mar 26, 2014
-
It sounds like you're in a tough spot, but I believe you should contact builders, carpenters, etc in your area and see if you can pay as you go, since you are not low income. I'd also look for well known, reputable Contractors who can arrange for the electricians, plumbers, painters, etc for you, and you pay one person, the contractor. How wonderful for you that you have the income to pay your bills on time with a little extra ! Maybe it's time to look into a nice Modular home, they are very well built, and you can get financing through the company that builds them ? At some point, an old house is not worth fixing up...and you might be there. :) Good luck !
Jossi
on Mar 28, 2014
-
Well let's see...I suggested you get help from the state and you told us you had money and didn't qualify for help. You mentioned paying cash and paying bills before they are due. I then suggested that you pull together what you could, talk to contractors and pay for repairs, and now you tell me that you're not wealthy. Seems I can't win ! Good luck, WHATEVER you do !
Jossi
on Apr 04, 2014
Sign Up to Answer
Related Discussions
Suggested Project Book
