Need refi , rehab, with sweat equity if possible
Hey all. Trying to figure out how to help my old man out. Here is his situation.
He lives in SC, but owns an investment property in FL. This mortgage would be for the investment property.
He is 69 years old (maybe that's useful)
Credit 700-750
The house payoff is $55,000
The value currently is about $70,000.
Looking to put $30,000 in rehab cost
ARV estimated at $120,000
He wants me to manage the project as owner/builder with POA. I can self-perform more than half the rehab. I can't do it for free. I would be going to FL from MA and househacking the remodel if possible.
FNMA Homestyle reno loans do not compensate for sweat equity, but they do offer refi/rehab for investments.
Are there other options I may be missing?
Thanks in advance!
Most Popular Reply
@Joshua Fulenwider - FNMA does not allow the owner or an owner's relative to complete the work. Even if they are a contractor. The contractor must be unrelated. The reasons for this are obvious, the lender needs to know the bid is accurate and there are time limits for completing the work...generally, a contractor will complete the work much faster or at least on schedule. An owner may take their time and not finish before the deadline.
With a rehab budget under 35K, you could look into a streamline renovation loan product. Few companies offer this (I know of one), but although the criteria and process are similar, it is less paperwork than Homestyle.