Having problems finding your dream home? Have you said, "great home, great location, too bad the kitchen is so outdated?" Don't overlook these properties, as there are mortgage programs available that can help you get into the home with the dream kitchen or hardwood floors you so badly want. These programs save you the inconvenience or hassle of arranging a second loan after closing to do the improvements.
Both CMHC and Genworth Insurance offer a program called "Purchase Plus Improvements" that allow you to purchase a home, renovate it the way you like and incorporate the cost of the renovation in your new mortgage - for as little as 5% down payment based on the improved value.
For example, if you purchased a home for $280,000.00 and wanted to do $28,000.00 worth of renovations, GE/CMHC will insure a mortgage based on 95% of the "improved value". In other words, your down payment in this example would be 5% of $308,000.00 or $15,400.00. The key for this working is that the renovations you make add value to the home. In this example, the insurer and lender would have to agree that the renovations you wish to make would increase the value of the home by $28,000.00.
Improvements must be structural and permanent to the home or property. In other words, new windows, flooring, roofing, kitchen renovations, bathroom renovations or a new garage would all apply, but a new refrigerator would not as it is not a permanent part of the home. By this example, a built in dishwasher or built in ovens as part of the renovation would be eligible because they are permanently appended to the home.
The advantages of utilizing the Purchase Plus Improvement programs are that the cost of the renovations are incorporated in a low interest mortgage. For an additional cost of only $130.57 per month on your mortgage payment, you will get that amazing new kitchen you have been dreaming about or those beautiful hardwood floors that you love!
For more information, call your VERICO One Link Mortgage Professional today at 204-954-7620!