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I have a coop in Queens, NY. I am looking for "future value" financing. My unit does not have enough equity to do a standard cash out refinance. My builder suggested that I look for a lender who can lend on the new value of my home. Any suggestions would be helpful.
You are really talking about a "traditional home remodeling loan". Downsides include lack of mortgage interest deduction AND rates that might be as high as a credit card.
The minor upside is that it ought not to technically cloud your title, but if you need to sell before the work is done and your are out of money that really won't matter anyhow...
If you are a member of an employer sponsored credit union that is almost always the best source of traditional home remodeling loans, but even then be prepared for rates that are double what mortages are...
I would also investigate using a 203k REFI, this are technically mortgages but will also work for SOME remodeling expenses. Trying to find a lender that likes to do these is HARD becuase there is considerably more upfront running around (you need pretty detailed quotes from contractors that are going to be used to set the loan amounts) and the odds of things not coming in to range of allowed work / value means those upfront costs are not reimbursed...
Thank you for your advice, but I found a lender who can offer me a renovation loan and then a permanent loan for my individual coop unit.
The 203k loan does not cover COOPS.
If you would like his information, I can give it to you.
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