Posted on August 3, 2017
Fixer upper home in Dallas are foreclosed homes that are purchased at low price, renovations and repairs are done and sold at a high price. It is similar to wholesale rehabbing.
Financing strategies :
How 203k loan works?
Federal housing administration offers 203K loan scheme for investors to avail money for financing the fore closured home as well as for rehab properties for sale in Atlanta. Using the single mortgage, repairs are made. The credit scores and down payment guidelines of FHA are applicable while availing the mortgage.
The 2 types of 203K loan are:
Limited version of 203K loan scheme allows investors to avail money for smaller fixes.
Standard version of 203k loan scheme provides funds for bigger fixes with the approval of licensed contractor. The contractor is hired for the purpose of estimation of repair cost. Once it’s calculated, you can avail the same amount through 203K loan scheme. Also, the appraiser can give a property value estimate when the repair work is done. The borrower cannot avail any other mortgage during this period and he should occupy the property once it’s ready for occupation.
How home style renovation loan works?
The investor can avail home style renovation loan to do repair work. The credit scores and down payments are bit higher than FHA program. The loan scheme gives entire year for repair work to get completed.
How traditional loan works?
The investor is allowed to borrow 2 loans at a time; i.e. first loan has to be repaid when the house is under repair phase, second loan payment and first loan leftover payments has to be repaid while its ready for occupation.
Before purchasing a fixer upper home in Dallas, you should know about the benefits and drawbacks.
Buyers can save on stamp duty tax and property tax is levied based on selling price of the property.
When your property is designed new roof and siding, hardwood flooring, insulation, you increase the chances of selling the home faster and you can price the property accordingly ensuring that you earn profit. Hire agents to get the estimate price of the property. Do a comparative assessment to know the property value by getting the prices of similar homes in the neighborhood.
Low monthly mortgage payments
You can customize the entire home from scratch.
The appreciation in value is faster
Wholesalers can find rehab properties for sale in Atlanta from the real estate websites and make necessary repairs and sell it as fixer-upper homes.
If major repair work is involved, investor starts spending from his savings. Avoid these kinds of properties.
Lot of time and hard work is required, during that time if the investor faces situations like job transfer or relocating, it is difficult to sell the property.
Unexpected expenses or hidden cost is common. E.g. Plumbing, pest problem
Avoid homes that have been not accepted by financial organizations. They are not supported because the monthly mortgage payment, property maintenance fee or any legal fee would have been missed to pay by the previous owners.
Avoid properties in the listing that says little TLC needed.
Tags: Fixer upper home in Dallas
, Rehab properties for sale in Atlanta
, wholesale rehabbing