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How to Add the Renovation Costs To Your Mortgage When Purchasing A Home... This program is perfect for first time homebuyers wanting to buy a fixer-upper, and Realtors who wish to offer a larger variety of homes to their buyers. Here's an ideal situation for using our Purchase Plus Improvement program: A young couple with 5% down are looking to buy a modest starter home. They find a 2100 square foot, 37 year old home in a nice neighborhood for $319,900 - however the home needs new flooring and a backyard fence. The flooring is going to cost $7,500 and the back fence about $1,500 for materials as they can install it themselves. Since the couple only have the 5% down payment and closing costs, this home would seem out of reach and the search would continue. Our Purchase Plus Improvement program can help make this purchase a reality. Here's how it works: 1.) We pre-approve the couple and obtain a 90 to 120 day rate guarantee 2.) The clients find a home and write an accepted Offer to Purchase 3.)
The clients obtain a quote for the flooring and a
quote from the local lumber store for the fencing 4.)
We add the cost of renovations to the purchase price
and send the application along with the 5.) The mortgage is approved, signed, and instructed to the solicitor/notary 6.) 95% of the renovation costs are advanced but held in trust at the solicitor/notary's office The clients pay for and complete the renovations and submit the receipts to our office. The funds are then released at the solicitor/notary's office and a cheque is made out to the new home owners to reimburse them for 95% of the renovation costs. The Details: * Appliance purchases cannot be financed in this program * The clients have 2 to 6 months to complete the work * The clients can take 1 to 5 draws as the work is completed * Reimbursement for work completed usually takes 1 to 3 business days *
Larger renovation projects
sometimes require an inspection - this
usually costs around $75 per
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