How $3500 became $30k Equity in 45 days!

Before and After
Before and After

It’s true this happened.  Not only did it happen with on one of my client(s),  similar occurrences has occurred with others.   Its equivalent to the Acres of Diamonds story I blogged about earlier last week.  Finding these gems are right in our own backyard and sadly many buyers don’t realize what they can discover until after they start digging.  This is what makes my JOB so exciting as I have the best work-life ever.  In fact I don’t even call it work or a JOB for that matter.   And the great thing about what I do is viewing the finished home with countless AFTER pictures forwarded to me from clients showcasing  how their House turned into a Home.

For those that may not know me very well let me try to formally introduce myself.  I am not your average mortgage lender who wears worn suits, scuffed up shoes, wrinkled company logo golf shirts, and loves casual wear Friday with my name tag on upper-right side of my shirt screaming for me to step back and eat a tick tac!   Yeah, you know who I am talking about.  Don’t get me wrong I do all those normal traditional mortgage lending programs and still do, but I added a special ingredient six years ago that most mortgage lenders did not offer, still don’t offer,  don’t participate,  don’t understand,  and are not willing to learn.  I originate Renovation Mortgages!  This started out as a niche program for me six years ago and now has been become a hefty part of my business today and I love it.  I love hearing and seeing the faces of our clients who get to buy a home in its AS IS condition and come to me wanting that HGTV vision, that is so awesome and such a great story to share.   WIth the best contractors in tow and a customers wish list I add these renovations to the sales price in preparation of ordering a improved value appraisal.  The two most popular programs we offer is the FHA203k and Conventional Renovation Mortgage Program.   WIth over 128 Million Existing Homes in the United State and 75% built before 1990 why would anyone just settle for AS IS as most homes need some form of updating?  Think about it why would anyone who wanted a home waste all of their financial reserves after closing to renovat their home, (this actually  exists as most Americans do not have necessary reserves after they buy their first home to invest in improvements back into their home) or nickel and dime a wish list of wanted repairs over the next two years charging up credit cards.   Now you know why the average credit card debt increases after buying a home.   

Before Kitchen and After Kitchen Remodel
Before Kitchen and After Kitchen Remodel

Ok I know, you wanted to know how a client invested $3500 into a purchase of a home and walked away with over $30k worth of equity over what their loan amount?  Simple, they researched, found a home, (hopefully with a professional Real Estate Agent that will listen to the clients request), had a vision, called me at to start their application, and once we received back their appraisal on their home the improvements valued for $30k more than what they owed on the property.  Sweet right?  Also, we were able to close/fund on the mortgage loan in 45 daysx under one closed mortgage payment with all renovation to begin the day after closing.  Priceless right?  Now please understand nobody knows including me upfront that any renovation will appraise for more than what they will be indebted because that would be impossible to know much less completely unethical if I advised such at time of application.   We as professional mortgage lenders let the professional appraisers determine what is the improved value not what I or you assume.   And please understand that I am not soliciting you or stating that if you originate a mortgage with me that you will walk away with more equity than what you invested.  But with the right vision, right home, and right renovation you just might experience such increased value.   For the past six years of originating these mortgages in my licensed markets that I originate, (TN, MS, AL, AR, LA, and TX)  I have personally originated many renovation mortgages whereby the appraisal improved value is higher than the loan amount opposed to the traditional AS IS purchase with no renovation which is what most path buyers follow.    Now another disclaimer that I must mention as well is  I have also seen buyers/homeowners investing to many improvements into their home making the improved value not appraising for what the expected, which means the client has to go back to the drawing board and reduce their bid or just hang it up.    We call this over improvement for the home.   But lets face it, wouldn’t you like to know upfront with a professional evaluation which renovations you are about to spend will add value?  How many buyers have you seen close on their home making trips to Home Depot or Lowes out of their own pocket only to realize when they try to sell their home later the fence improvement or deck add-on they made did not add dollar for dollar added value, ouch!   So if your expectations is not trying to turn your home into some equity skyscraper but would love to renovate because you are  having a tough time on your traditional house hunt then give me a call and lets talk shop.


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