If you’re looking to buy a home that needs some work, a Purchase Plus Improvement Mortgage might be a great option for you. This type of mortgage allows you to borrow extra money to make renovations or improvements to your new home. It’s perfect for those who find a home they love, but maybe it needs a little TLC to become their dream home.
How Does a Purchase Plus Improvement Mortgage Work?
A Purchase Plus Improvement Mortgage works by combining the cost of the home with the estimated cost of renovations into one mortgage. Here’s how it typically works:
- Find a Home and Plan Renovations: First, you’ll find a home you want to buy and decide what improvements or renovations you’d like to make. This could include anything from updating the kitchen to adding a new bathroom.
- Get Quotes for Renovations: You’ll need to get quotes or estimates from contractors for the planned renovations. This will help determine how much extra money you can borrow.
- Apply for the Mortgage: When you apply for the mortgage, the lender will look at both the purchase price of the home and the cost of the planned renovations. They will then approve a mortgage amount that includes both costs.
- Renovation Funds: The money for the renovations is typically held in trust by your lawyer or the lender. Once the purchase is complete and you take possession of the home, you can start the renovations.
- Completion and Inspection: After the renovations are finished, an inspector may come to ensure that the work has been done. Once everything is approved, the renovation funds will be released to pay the contractors.
Benefits of a Purchase Plus Improvement Mortgage
- Turn a Fixer-Upper into Your Dream Home: You can buy a home that needs some work and make it exactly how you want it.
- One Mortgage, One Payment: You don’t have to take out separate loans for the purchase and the renovations. Everything is rolled into one mortgage with one payment.
- Increase Home Value: Renovations can increase the value of your home, which is beneficial if you decide to sell in the future.
- Flexible Renovation Options: You can use the funds for a wide range of improvements, from small upgrades to major renovations.
Things to Consider
- Budget Carefully: Make sure you budget carefully for your renovations. The amount you can borrow for improvements is usually based on a percentage of the home’s value after renovations, so it’s important to have realistic estimates.
- Timely Completion: Some lenders may have a time limit for completing the renovations, usually around 90 to 120 days. Make sure you can complete the work within the given timeframe.
- Quality Contractors: Choose reputable contractors to ensure the work is done well and within budget.
Call to Action: Let’s Make Your Home Vision a Reality!
If you’re considering buying a home and want to make it your dream home with some renovations, a Purchase Plus Improvement Mortgage could be the perfect solution. With my experience as a mortgage broker, I can help you navigate the process and find the best mortgage for your needs.
Interested in learning more? Contact me today to discuss how a Purchase Plus Improvement Mortgage can help you buy and improve your new home. Reach out via phone or email. Lets talk mortgages.