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Selling Ugly Houses - Purchase Home Improvement

By
Mortgage and Lending with GMAC Mortgage

With new construction all around us, it seem likes its tougher and tougher to sell existing homes.  How do we sell more homes by overcoming the buyer's objections when showing them properties?  I hear Realtors state that they need a creative response to the statement by potential buyers of "We would buy this house today if it had ____!!"  Many buyers are looking for the "perfect" home and in reviewing the existing inventory will find several homes which meet "almost "all of their requirements but because 100% of their wants and needs are not met they continue to look.  This continued market search for the perfect home is very time consuming for the Realtor. Perhaps this idea can show you how to take that"almost" perfect home and make it the home of their dreams.

 Here's how it works:  Mr. and Mrs. Smith are out with their Realtor and they find the "almost perfect home in their price range of $300,000. Everything is just as they had wished but they were hoping for a finished basement and this particuar home has an unfinished basement.  What do they do? Do they go ahead andy buy this home and hope to finish the basement at a future date (once they have saved up the money to do so)  or do they look at their Realtor and say "let's keep looking"?

Many Realtors will tell you that they "just keep looking".  Their buyers want their dream home now not later after they have saved money to do the basement) but their cash available limits them to a home in the price range of $300,000. 

 Before Purchase Home Improvement

 

If the Realtor can show Mr. & Mrs. Smith how to buy this home, get the basement finished and do it with equal or less down payment, they would certainly be a hero!  The Purchase  Renovation is the perfect solution!! Let's look at the numbers.

If the purchaser buys the home and finishes the basement at a future date: 

Purchase Price =    $300,000 (as is value per appraisal), Max LTV of 95% = $285,000 Loan Amount, Down Payment = $15,000

Cost to Finish Basement = $30,000 (completed at a later date)

The Buyers will invest $15,000 in this transaction to purchase this property and still be faced with figuring out how to come up with another $30,000 at some point in the future to finish off the basement (something they would really like to have done today.) No wonder they want to keep looking!

Now let's take a look at the numbers using my Purchase Home Improvement Program.

Purchase Price = $300,000, Cost to Finish Basement = $30,000, Total Cost = $330,000 (300K + 30K)

Subject to completion value = $350,000, Max LTV of 90% = $315,000 Loan Amount.  Down Payment = 15,000

As you can see, the customer gets the home they dreamed of with no additional cash investment required!! For the same $15,000 investment, the buyers have been able to purchase the home AND finis off the basement to create their "perfect home."

 finished basement

For more information about this type of program feel free to email me at kathy.wilson@gmacm.com or call me at 866 720 4622 ext 11.

 

 

 

Susie Roscoe
Signature Realty Associates - Brandon, FL
Real Estate Specialist | Brandon, FL
CONGRATULATIONS on your very first blog!!  You're off to a GREAT START Kathy!!  I'll drop a few friends a line and have them WELCOME YOU to the RAIN!!!  Keep up the good work!! 
Aug 15, 2007 12:03 PM
Leah Ross
Your Tampa Bay Mortgage Source - Tampa, FL
Tampa, Florida Mortgage
Welcome to AR Kathy!  This is a great article on rehab loans available to buyers looking for the almost perfect home!  Way to go!
Aug 15, 2007 12:34 PM
Missy Caulk
Missy Caulk TEAM - Ann Arbor, MI
Savvy Realtor - Ann Arbor Real Estate
Welcome to AR Kathy, Susie, gave you a great recommendation. I'll have to get with my GMAC lender to hear more about this program. I didn't think it was offered very often. Is the appraisal based on the finished basement like it has been done ?
Aug 15, 2007 12:45 PM
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services
Congratulations -- this was a very informative article.  It is a program which all real estate agents should make themselves familiar.  Thanks for the reminder about this option.
Aug 15, 2007 01:02 PM
Mana Tulberg
805 County Real Estate - Camarillo, CA
Real Estate Agent - Camarillo CA
Kathy, Susie had recomended to come over here and read your post and such an awesome post this is for any homebuyer who needs a rehab laon.
Aug 15, 2007 01:14 PM
Cyndee Haydon
Charles Rutenberg Realty - Clearwater, FL
727-710-8035 Clearwater, Beach Short Sales Luxury Condos &Homes

Kathy - Wow - you did a great job - are you sure this is your first post - you're a natural - Looking forward to getting to know you better and glad you're here - I'm a BRO member too :-) If you ever have any quesitons - dont' hesitate to ask.

Aug 15, 2007 01:17 PM
Paula Henry
Home to Indy Team @ HomeSmart Realty Group - Avon, IN
Realtor - Indianapolis Real Estate - 317-605-4174
Kathy - This is great info! Looking forward to many more of your insights into successful selling.
Aug 15, 2007 01:40 PM
Susie Roscoe
Signature Realty Associates - Brandon, FL
Real Estate Specialist | Brandon, FL
Kathy - the crew hooked you up!!  You did great...and now it's NO SECRET you'll be writing great blogs!  Keep up the good work!
Aug 15, 2007 02:16 PM
Suzanne Sands
Pavao Real Estate - Somerset, MA
Somerset MA Real Estate

Hi Kathy,

just wanted to stop by and welcome you! Great job on your first post. :)

Aug 15, 2007 02:24 PM
Rita Taylor
None - Sanford, NC
Sanford NC Real Estate - Homes for Sale in Sanford North Carolina

Kathy,

Welcome to Active Rain!  We have a bunch of family in Greenville - I went Eastside High more years ago than I want to count.  This is a great loan program - I saw a similar program used where a manufactured home needed a permanent foundation to qualify for an FHA loan. 

Aug 15, 2007 02:51 PM
Rick & Ines - Miami Beach Real Estate
Majestic Properties - Miami Beach, FL

That's what I call creative!  Congrats on your first post and please keep those ideas coming!

Ines

Aug 15, 2007 03:07 PM
Toby Boyce
C.G. Boyce Real Estate Co. - Delaware, OH
MBA, Delaware Ohio
Welcome to AR and it is obvious by this post that you are a great addition to the network!
Aug 15, 2007 03:57 PM
Ilyce N. Powell
Financial Revitalize - Baltimore, MD
CMPS- Certified Mortgage Planning Specialist
Hi Kathy! Welcome to ActiveRain and congratulations on your first blog entry!
Aug 15, 2007 04:18 PM
Thesa Chambers
West + Main - Bend, OR
Principal Broker - Licensed in Oregon
what a great first post way to go.... Susie was right you are going to soar here - welcome to the rain
Aug 15, 2007 05:14 PM
Ashley Drake Gephart
Drake Intel Group - Albuquerque, NM
Susie sent me over here and this is a great first post! Welcome to the rain!
Aug 15, 2007 06:44 PM
Frank Harris
Keller Williams Realty Centre - Columbia, MD

Welcome Kathy,

Good blog, I wish I would have use that type of loan when I purchased my home. My basement is still unfinished. :)

Aug 15, 2007 11:09 PM
Kathy Wilson
GMAC Mortgage - Greenville, SC

Thanks so much for the support.  I am very excited.  To clarify, yes the appraisal would be subject to the basement completed or any other improvements.

 

Aug 16, 2007 02:43 AM
Kim Murphy
Draper and Kramer - Lombard, IL
Mortgage Loans in DuPage, Kane, Cook, Lake, Will C
Kathy - CONGRATS! on your first post!  You did an awesome job!  I will be talking to my GMAC rep about this program!  Welcome to the RAIN!
Aug 16, 2007 04:48 PM
Anonymous
John Harris
That is a nice plan.  You sure were helpful in refinancing my home.  It worked out so well that I was happy to use your services for two investment properties I purchased.  I will be using you again, and that's for sure.
Aug 17, 2007 03:31 AM
#19
Fred Griffin Florida Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

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    Surf some blogs, leave some comments. 

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Apr 27, 2016 11:43 AM