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Funding renovations

I purchased a bank-owned home and am now struggling to find funding to make the renovations necessary before moving in. Given my income ($5400/month) and credit (770+), I expected that I would have little problem getting a loan or credit line. My first thought was to pursue a home equity loan or credit line. The home is easily worth $185k-195k. I paid $150k. Despite at least 4 sales in the neighborhood within the past 3 months that support that value, the credit union appraiser estimated its value at $170k. He used 3 homes in a bad part of town that are nothing like mine as the comps. With the CU's rules, that value left too little equity to provide me with enough to do the renovations (I need $30k at most). I currently have 2 credit cards w/ low limits - $6000 and $7000, and I've nearly maxed both out paying for repairs so far. Given my income and the absence of any debt other than this mortgage, I should have no problem getting approved for small loans or credit lines, I thought. At that same credit union with whom I pursued the HELOC, I applied for both an unsecured personal line of credit of $10k and a Visa with a $10k limit. I was denied due to my debt-to-income ratio being too high, according to the CU. After paying my mortgage each month, I have more than $2600 remaining from my paycheck, so how is my ratio too high? More importantly, what do I do now? Have I exhausted my options? I need to replace the carpet and would like to do so before moving in, so how do I pay for it? Other than the options I've already tried, what else can I do? Just $15k would help tremendously, but I can't even get approved for $10k.
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August 24 2009 - US
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Replies (1)

Well some companies will allow you to do financing on the project.  For, example, for those w/ good credit, we have a program through GE Credit where customers can finance the project for a year...and then, they pay for it at the end of that year.  So, you may want to try to find a company that offers that.

Also, you could look into finding another appraiser that could reassess your property.  I might, however, check in w/ a realtor to get their perspective on what they think it should be valued to confirm or refute your thinking.
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August 24 2009
 
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