Trashure Hunt homes. Ugly to Gold
Turn trash, trashy, ugly homes into your dream home!
For Most home buyers, they're attracted to .... what? The prettiest home on the block. And we're not saying that's wrong. Or that's a bad thing. Or that it's unusual to want the cream-of-the-crop. Best of the best. It's totally normal.
The problem with these properties is ... this is where you're most likely to see crazy bidding. Buyer giving up crucial elements of the standard contract which are there protect them. If you're a buyer, I'll tell you it's never a good idea to not do a professional inspection of a property (buying "as-is"). It's not smart to waive an appraisal, or to offer an appraisal gap. Appraisal gaps are where buyers offer to cover the shortfall on the true value (appraised value) and the contract price.
It the equivalent of gifting money to the seller. It's flat out stupid (in my opinion). Other agents can and will tell you differently, but the appraisal is done by the lender. It's essentially an unbiased view of the contract price versus other similar homes. The loans are based on this value. If the home was priced at $499,900 and the buyer offered $520,000 to make the seller "say yes"; it means in math, and dollars and cents, they could be preszenting the seller with a "gift" of $20,100. In the scenario: if the home appraises for $499,900. On paper, the buyer has to come up with that extra $20,100. That's in addition to their typical down payment and closing costs. Ouch.
Here's my easy example to help decide is this smart? If you ask me to break your $20 bill with smaller bills - and handed you three, five dollar bills. What would you do? I'll do that all day long.
It's you giving me $5. For what? Convenience? I'll call that ridiculous, but that's how I see appraisal gaps (in most cases).
If you are my seller and a buyer offers an appraisal gap - I'll say that's a good thing because it potentially is a gift to my client- the seller.
If you've watched even one cable remodel show, or anything online about housing. What do you see? Fantastic, beautiful homes. Even most of the remodelling shows are really taking decent houses and making them nice.
Trashure Hunting works for those as well. I think of Trashure Hunting as looking for the ugly, worn and maybe even beaten down houses. With enough money, any ugly house can become a diamond. But this is where you need some experienced, professional help.
How much will it cost to go from trash to treasure? The rehab, or remodel. 
That's a great question. What will it cost to from trash, trashy, ugly, run down, worn to fab, fabulous, beautiful, pretty aka: in style? Obviously this is different on every project and this is also where it takes more than guessing or good fortune.
First to do:
* Determine if you are you willing to live through a purchase and remodel?
Second to do:
* Determine what you are qualified to do in dollars and cents by getting pre-approved with a lender who has experience with this type of loan program.
* Where to get the rehab, remodel loan (often called a 203k). Nearly every lender has them. But they don't promote them. Why? They take longer to approve and typically at least a few months for the remodelling. Sounds easy to you, or me. But it's not what they like to do on loans. It's not what they want to do on loans. It can be confusing to process the paperwork behind the scenes and they would probably say (behind closed doors) they're just too much work.
Third to do:
Start determining where you want to be and get an active "trasy home" search initiated. You can do it yourself but getting the results directly from the local MLS has a few advantages.
There is a lot more to this but these are pretty good starters points to consider.
In most cases the purchase and remodel loan allow for some dratic bugets for the remodel. Just hypothetic, but you can buy a $400,000 trashy home and put $300,000 or more into it with the remodel. It depends on what the estimated future value
Everyone working with Michael Bishop, The Cooler, Real Estate Agent is committed to the purchase and remodel process. The Lender, the inspector, the builder/contractor/ general contractor.
Like most things, the more you do it, the better you become. The group of companies and individuals selected are committed to helping our clients achieve success.
Michael Bishop, The Cooler, Real Estate Agent's Google business profile: Michael Bishop The Cooler Real Estate Agent's Google business profile
It's the less travelled road but if you follow our road map - you too can successfully be a trash to treasure home owner!
Link to Michael Bishop. The Cooler, Real Estate Agent: on google: The Cooler, Real Estate Agent on GOOGLE