Buying A Home
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Mortgage and Home Equity Loans question
Hi,
This is our 3rd time buying a house but the first time wanting to buy a house to renovate. We want to buy a home with the intent of putting 100k into it to make it exactly to our taste. Would we get a regular mortgage and then a home equity loan on top of that for the renovations or is there a way to wrap it into one?
Thanks!
Re: Mortgage and Home Equity Loans question
You can only get a home equity loan if you have equity.
Usually, when you first buy a house, your equity is going to be equal to your down payment, assuming you're paying fair market value for the house. Say you buy a house that's appraised for $400,000, and you agree to purchase it for $400,000. You get a mortgage for $320,000 because you put 20% down ($80,000 down payment). At that point, you have $80,000 in equity in the property.
Sometimes you can get a renovation loan, which is sort of like a home equity loan except it's based on added home value after the renovation (as opposed to a home equity loan, which is based on equity you have in your house at it's current value, before renovations).
Or you can check into an FHA 203k mortgage, which provides you money for repairs and renovation.
Mr. Sammy Dog