Lenders Not Doing Renovation Loans

[Caesar Perez]

So lenders have have ceased renovations loan, how long does everyone anticipate this goes on for?

Can anyone speak to their experience during the 2007-08 market?

[David Ginn]

@Caesar Perez


I have never seen a lender not do a renovation loan. You might have lenders that freeze up, but I think more of what you’re going to see is that they require more money down and possibly may only do 60% of loan to value where before they may have normally done higher like 70 or 80%. But there is normally always someone out there that will lend you money for renovations. So they are not going to stop lending, what they are instead going to require is that you have more of your own skin in the game if you’re going to borrow from them. As for the percentage rate on the loans, it seems to stay about the same which is 12% with a point or two. But as a general rule, lenders don’t change their interest rate as much as they’ll just require more money down from what I’ve seen.