All Forum Posts by: Derrick Dill

Can you convert the garage to an ADU (additional dwelling unit), Can you put an ADU in the backyard? Some places have a living room/family room/dining room which can be converted to an extra room (depending on lots of variables)

Get a team in place: Contractor/handyman, cleaning person, maintenace (lawn,snow, landscaping etc.)

Deepti,

I'm also in the Bay area and it's a competitive market, but if you find a fixer, the seller might be willing to work with you. With a 203k FHA renovation loan, you put 3.5% down, but can only go to the maximum county limit of ~823k (2021), so you'll have to come out of pocket with remaining 1.1mil - 823k (doesn't seem viable)

You can see if you can get a jumbo loan 5% down and save the rest for renovation

FHA loans are less competitive in this market because they have more rigorous inspections, guidelines, less down, longer close times so if you're (for example) selling your property, would you want to sell to someone with more guidelines, inspections, less money down, longer closing time or a conventional with less of all that was mentioned? As a buyer, I feel better with the FHA appraisal, someone going to check that the place is in livable condition for me, in addition to my own independent home inspection, I know what I'm getting into.

203k IS the FHA renovation loan option. There are also low down <5% fannie and freddie loan options Home possible/homeready if I remember correctly.

There shouldn't be any reason he's not eligible for Cares act forbearance. His situation is exactly who they made it for. Put the payments on pause and figure it out in 6 months, added to the end of the loan

Your lender will see a huge red flag that they see your in forbearance, you've elected to not pay your mortgage because you are having financial issues. It will be very difficult to get another mortgage through traditional financing while on forbearance. Will be much easier to buy after forbearance is over. 

Legally, you would have to get that permitted. Some contractors will be able to help you (do them on their own) with the permits, if it's more complicated will need a architect.

The best, most accurate guidance will be from the city. Call or email them with this question

401k loans are not counted against DTI. Take out a 401k loan, pay off a different loan. You have the same debts, but have lowered your DTI and will pay interest to yourself with your 401k loan.

This assumes you're comfortable with this leverage and the gains you'll miss out on in stock market.

You'll need permit to have it legally added. Check your cities website for permitting requirements/instructions. Will need an architect to help you get the documentation needed to get the permits.