All Forum Posts by: Ginger Spurlin

Update,

Bought for 190k > spent 190k on rehab > appraised at $415k and refi 75%ltv at 6.99% so I still have loan on my HELOC. It ended up as if I would have put a down payment on a $415k house with a HELOC so I have a $310k mortgage payment plus 9% Heloc interest payment on this property. We moved in and are going to live here until it appreciates enough to sell. Thank you for all your help I learned alot on this one. Mainly, how to better pencil my next deal.
 

I am using 0% credit card offers that give you a flat fee of 3 to 4 % and expire after several months.  I am also using a Home Depot project loan.  

Thank you all for the responses there is definitely alot to think about. I am committed to finishing the house. I have put alot of my own labor into it and I am doing a quality rehab not lip stick on a pig. Complete transformation. It's going to be a nice house and its hard to find a nice updated 4/3 on three acres in a very desirable school district down here. My realtor didn't help me with comps even though I asked him several times. I will find a new realtor and try and get my ARV dialed in. If the arv is lower then 350 then I'll have to carry more unsecured debt. The house is in drywall stage and I don't want to sell an unfinished house. I am going to live in it and it will be a good house for my family for a couple years.

I appreciate your responses!  I guess my other concern it my ability to get a good rate on the refi since I will have so much cc debt.

Total Renovation Cost is $182k and I have $104k into it so far ($42k from HELOC on other home and $62k on CCs and Home Depot Loan). I only have $27k left on HELOC and was having to put the remaining $51 on CC and Home Depot Loan. House should be done by end of June worst case and was planning on Refi but I think i will be $20k to $30k over ARV. I bought 4/3 2100SF on 3 acres built in 1982 for 190k ($90k under asking) and I anticipate the ARV to be $350k. I am a rookie and miscalculated to rehab cost even though I've been in construction my whole life. New Roof, Windows, Siding, HVAC, Electrical, Insulation, Drywall, Tile, Cabinets, Appliances, etc. I plan on living in the house with my family until the market gets hot again.

What do you when you used credit card debt to renovate a house that was over budget and still need to finish the renovation?

@Brad S. this write up is amazing!  This is exactly what I was wondering.  Thank you for all of the insight!  I hope this post will also help others in similar situations.  Thank you very much for your time and effort to answer this post!

Thank you @Kevin Sobilo !  It sounds like my best course of action is to call the building department, ask if they have record of the permit for the additional rooms, if not, let them know that this was done and ask them what I need to do to make it legit?  I want a legit 4-3 with the correct sf for re-sale.  

@Kevin Sobilo , @Andrew Syrios and Eliott Thank you for your quick response.  Please allow me to expand on my question.  This property is in Alabama and I understand the laws are different in different states.  The property is being sold as is and we got a decent deal.  My lenders appraiser called it a 3-2 I think because of the tax records but I am not sure.  I discussed this issue with my realtor and he told me in AL the appraiser looks at the current snap shot in time and is not required to pull up the permit records, therefor if it looks like a 4-3 it will be a 4-3, and base the SF on their own measurements.  He thinks the current lender appraiser messed up and that when I go to refinance after rehab the new appraiser will call it a 4-3 as long as it looks like a 4-3.  The work to turn it into a 4-3 was probably done like 20 years ago.  My realtor told me that AL might be different than other states in that the appraiser doesnt look for permits or tax records and that in AL the tax records are typically wrong.  I guess this is my revised question, Do I need to get a permit to turn the work that was already done into a 4-3 so it counts on my rehab appraisal at a later date?  This might require me to tare out drywall etc.  If I dont get the permits can I still list it as a 4-3 at a later date?  The lender appraiser wont talk details with me because he says he cant by law unless my lender initiates the process, but my lender told me he cant talk to the appraiser directly by law.  So I don't know how to talk to the lender appraiser even though I am paying for it.  Im not a realtor so is the law different in AL then it is in PA and TX?

Is the seller/agent accountable if they list a property as a 4-3 but the renovation/addition of the fourth bed and third bath was not permitted work, therefor,  it is still a 3-2 in the tax records and the appraiser didn't count it? Also affects the h/c sq ft.  Also should the buyer agent be responsible to discover that for their client?