Question:
“We’re buying a home and the owner is in the middle of redoing the kitchen. He started the demo work (sink, counters, some cabinets) but not the actual remodel. We’re getting a good deal because we said we’d take the kitchen as is. Will that create any problem with the sale?”
Answer:
If you’re getting a loan, yes, that could be a problem. Your lender will require that you have a functioning kitchen.
I see four possible ways you can complete the sale:
- Pay cash
- Have the owner finance so no bank is involved
- Have the owner complete the remodel before you close
- Get a renovation loan
If you don’t have enough cash, #1 is out. And few sellers want to finance the sale, so #2 may be unlikely.
So I see #3 and #4 as your more likely solutions. I know with #3 you may not get as good a deal, so you might try #4.
Renovation loans are little known loans that allow you to buy a home that needs work or that you want to improve. It requires a down payment, but the lender will make the loan for you to buy the home and do the renovations.
I know a great lender that does renovation loans. Just give me a call or email me at garyk@garykent.com.
