Can I get a HELOC on primary at end of remodel

3 Replies

I purchased my primary residence with an entire remodel in mind. The remodel is 80% done, but I'd like to see if I can get a HELOC to help shore up some final costs. I had some other expenses (not related to home) come up that took ~$20k of reno budget away, so I am looking to try and get a HELOC to re-coop those funds.

The intent is to get a cash out re-fi in Feb 2020 after remodel is 100%. 

Some other details- 

Purchase price- $310k

1st mortgage- $290k

Reno budget- $80k, $60k spent so far 

ARV- $430k

The question I have is what does the condition of the home need to be in to get the appraisal to get the HELOC? Current condition of home does not have any exposed studs, but has one bathroom with out a vanity/floor, another does not have floor. There is also no baseboard/trim. I have completed the kitchen, and installed wood flooring through out and two other bathrooms are complete.

Any help would be greatly appreciated, thanks! 

@Kyle Sullivan

This sounds extremely similar to my girlfriend and I's situation. We're also about 80% of the way there and intent to finish it up after we finish working on a current rental property. We have contacted about 3 banks about getting a HELOC on an investment property and also on the SFH that we live in and are fixing up. Of the three banks that we contacted, one did a drive by appraisal, the other said they would come in and appraise it, and the other said they would do a drive by appraisal.

In your case, and in our case with our SFH, the drive by appraisal would work well. We live on plywood floors and they appraised it as if it were finished because they only drove by. So if you could get a drive by appraisal and have them come up with a number high enough, you might be able to make that work.

Unfortunately for my rental properties, I want them to come in and see the updates rather than just drive by because the drive bys tend to just give you a "middle of the road" appraisal.  My rentals after they've been rehabbed look great and would appraise for much higher than a drive by (based on market comps).  During a drive by they have no idea whats inside, does it have central AC, washer and dryer, etc? 

All in all, contact a few banks and see what appraisal process they use.  Good luck!

Thank you for that Marc! The original appraiser that appraised the home when we closed on it also just did a drive by. I had forgotten about that... I am positive that a drive would would appraise it for enough for me to get the $20k out to finish. Then I can get an actual appraisal in Feb 2020 for my full cash out refi. 

Thanks again!

@Kyle Sullivan the HELOC appraisal is different than Refi. I breezed over the numbers, if need help once get loan estimate on the Heloc be happy to delve into it further with you to help. Make sure best way to go about it. Feel free to reach out if needed. Best of luck