This article is for those home buyers who are looking into properties that need some kind of renovation and for those people who love renovation projects. Finding the perfect home is very challenging and if you are the kind of person that enjoys renovations, you will love this Purchase Plus Improvement Program.
What is this program? This program is an option for buyers who find a property to buy but it needs a lot of fixing up. Sometimes the property is the perfect location, good size, and great floor plan but the kitchen, bathroom, walls, and counters need to be renovated.
Do all banks offer this program? Unfortunately, no. You need to find a bank that will allow you to apply for the program when you are financing your new home.
How much can I get for the renovation? The amount of money offered by this program is up to 10% of the purchase price, generally to a maximum of $40,000.00. Some banks will allow for a higher amount and others, a lower amount.
Can I get this money and keep it instead of doing the renovation? No. The money will be held by the lawyer who took care of your closing. Once you’re done with the renovation, the bank will ask the appraiser to visit the property and write a report on the things that were renovated. After receiving the report, the bank authorizes the lawyer to release the money to the client.
How to apply for this program? When you find the property and you want to put an offer, make notes of all the things that you would like to renovate, and take pictures. You can talk to a contractor to get an estimate. It can be as simple as going to Home Depot and getting your quote there. When the offer is accepted, we would send this quote with the mortgage application to the bank to justify asking for the extra money. When you receive the approval the renovation funds will be embedded in the total mortgage amount and paid as part of your monthly mortgage payments.
Personally, I love this program. When you find the right place, the perfect location, and a property with a good floor plan, this program can help you to make the place amazing and consequently, increase the value of the property.
Takeaway: When you are searching for your property, floors, wall color, cabinets, doors, windows etc… remember that it can all be changed. Focus on the layout, the location, the essential structure of the home you choose.
I hope this article will give a different perspective and open your horizon to new opportunities. There are a lot of good properties out there that just need some “LOVE”.