If we find a really cheap beat-up home, a fixer-upper, can the costs for fixing it up be included in a mortgage?
Say we get pre-approved for $ 150,000 but we find a house that’s only $ 50,000 but it’s missing major kitchen appliances like a fridge and a stove, possibly missing the washer/dryer, and even toilet/shower, could those major necessities of a home that have to be purchased be included in the mortgage?
What about costs for an addition on the home? or smaller fixes like flooring or cosmetic things?
We don’t have much money saved, but there are so many cheap HUD/REO homes available that would cost us less than what we’re paying in rent. Most of them are in pretty bad shape, usually stripped by the previous owners, with holes everywhere.
Can we take the entire $ 150,000 that we are pre-approved for and fix up the house with it and then pay the monthly mortgage? Or, do they only give you the loan amount for the exact purchase price of the home and nothing else?
Thanks, Mr. Fix It, what if the home is worth a lot more than it’s going for, being that the bank is only interested in receiving the amount of cash that was left over from the previous owners in these HUD/REO homes, then would a lender be willing to at least lend what the house is actually worth? Say the house is being sold by the bank for $ 50,000 but it is actually worth $ 80,000, would a lender let us take out an $ 80,000 mortgage in order to use $ 30,000 to fix it up?