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I am bidding on a house that is not finished. What type of loan will I need, and how will the terms

  • August 13 2010 - Paintsville
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Answers (2)

What type of sale is this? Is this a foreclosed home you are bidding on?

It really depends on a couple of things:

First - what is the SELLER'S proposed financing? Many times the seller will tell you what type(s) of financing will be accepted...it could be an ALL cash sale or they may accept traditional financing.

Second - what stage is the house is in? If it is almost finished there is a chance you can use traditional financing. If there is more than $5000 of work still needed it may be possible to go FHA 203K financing and have your repairs/finish out rolled into your loan. (If the seller allows this type of financing)

I would think you need a Realtor to place a bid on your behalf. At least that's how it works here in Texas. Then your Realtor could investigate and find out what the seller's proposed financing actually is.

I hope this information helps! Best of luck to you!

Best Regards,

Lea Simpkins, eCertified Pro, SFR, TAHS
REALTOR®

  • August 13 2010
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good evening...first, let's address the house..it probably is a builder foreclosure?..if so..are there other homes right around it unfinshed as well?..if so..maybe look elsewhere..those will pull your's down until they sell..at probably much less $'s than your's...if it is an isolated property with finished/inhabited homes around it, and you can buy it for the right price.go for it......call flagstar bank in troy, michigan.. flagstar.com they are a good lender.what you want is one of two things..a construction loan to complete the home and an end loan to pay off the construction loan..const. loans a bit pricey,,they are short term..so the interst rate is almost secondary to the fees and cost of the draws..or- flagstar used to offer a combo loan.first part is a construction/ end loan..a bank is where to start...expect to have some of your own money into the deal...
hope that helps
best regards-
bob mcclure
mortgage one
brighton, michigan
  • August 13 2010
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