All Forum Posts by: Nicole Thompson

The bank already knows it's "under construction" - their knowing isn't the problem - the appraised value in its current state is what I'm concerned about.....

Okay, so we met w/the bank on Friday - and she felt we could do another line-of-credit kind of thing like the 1st time. Welllll, heard back today they no longer offer that sort of lending on these types of things......

What they want is a 15-yr loan w/fees, which doesn't "bother" us, BUT this time, they're requiring an appraisal...... So, we're not sure what to do b/c we don't want to say yes on proceeding w/the loan and the appraisal and incur the fees associated w/it if the house won't appraise for enough to close the loan.

So my question is, when a house is down to bare studs and under construction, how do they appraise the value (what's it based upon)?

We also have a plan in place to get the house DONE - our goal is March '09 - but these funds were somewhat critical for the plan....

Thank you for the suggestions. We have a meeting on Friday w/the original local bank to discuss "options", so we'll see what they say (they loaned us the original amount w/out even looking at the property or appraising it). In the meantime, I've also contacted a local mortgage broker we've worked with in the past and he's doing some research to see what he can come up with - including hard money lenders.

We've also thought of trying to bring in a partner.....just a little leery of that.....and not sure how that would work since we've already invested so much into it.....but we're not ruling anything out at this point.

Nicole

We purchased a rehab flip home awhile ago and made a huge mistake not re-financing at the start to liquify our funds again. We also trusted a "friend" to work on it (paid), but he averaged 10 hrs/wk - had many excuses why he'd work one week, then take off 2-3 weeks - he's since been fired.

Anyway, here we are.....running out of funds quickly and we're still in bare studs..... The only amount owed on this 4 BR, 2 1/2 BA home is $30k we borrowed from the bank (to pay this guy to do it and carry it).

I've been looking on-line at hard money lenders such as prosper.com, but I'm wondering if we should go back to the bank we borrowed the $30k from - it was a 1 yr interest-only loan - to see if they'll loan us more to finish it (I'm sure they'll extend the term, but that doesn't solve our money crunch).

Or do you have other suggestions? We're much heavier on the credit card debt now than we were when we started - this rehab was s/b a simple kitchen/bath redo, but when we tore out the existing kitchen, it became very apparent, it needed everything re-done.

We only paid $50k (plus the $30k loan) for the house and when we get to the finish line, our area should support a selling price of 189k (conservatively), so there will still be a profit at the end - IF we can successfully get to the finish line.

My husband does remodeling for a living, BUT here's the rub - we don't have enough funds left to both carry it and replace his wages for him to work on it f/t, which is what we'd like the additional funds for - to either hire someone else or have him do it and go to p/t or take a leave of absence from work until it's done. He's working on it evenings and weekends, but it's moving very slowly along and we're fearful we're going to run out of carrying funds LONG before it's finished (and sold).

We have MUCHO finishing materials already - almost everything we need (b/c as I said, we weren't figuring on tearing it down to studs in the beginning)......in your opinions, should we try to sell it as is to another "investor" or try to borrow more money and finish it? And if we do borrow more, how/from where?

The home is in Centre County, PA - and real estate market here is pretty "stable", so houses are still moving and haven't lost their values like many areas.

Thanks.