Sean Brown’s Post

Branch Manager at NMBNow

5mo

Work with a lender and enjoy peace of mind. When you collaborate with an experienced mortgage professional like me, you'll receive more than just any mortgage product. I can provide new perspectives on your purchase or assist with straightforward transactions such as home repairs. After viewing this video, if you're considering using any of these products, simply send me a direct message. We can explore scenarios that may place you and your family in an improved situation!" #trustedadvisor #mortgagelender #directlender #directlenders #mortgageloanofficer #mortgageprofessional #mortgageproducts #futurehomeowners #futurehome #renovations #renovationloans #fixandflip #fixerupper #construction #construcción

Transcript

Ever wondered about the differences between fix and flip renovation and construction mortgages? Well, you're about to discover the unique attributes and key differences that separate these types of mortgages. Imagine you're an artist. Each mortgage type is like a different canvas. A fix and flip mortgage is like 1/2 painted canvas. The initial structure is there, but you have the freedom to add your own flair. You buy a property, make improvements, then sell it for a profit. It's a quick process with the aim to sell as soon as the paint dries. The loan is short term, typically 12 months, and interest rates are generally higher due to the risk involved. Now think of the renovation mortgage as a canvas that just needs a few touch ups. You already own the property, but you want to make it better. This could mean upgrading the kitchen. Adding a bathroom or even an extension. The loan is tied to the homes post renovation value, allowing you to borrow more than the current value to cover the cost of improvements. The loan terms are longer, often 15 to 30 years, with more competitive interest rates. Lastly, a construction mortgage is like a blank canvas. You're starting from scratch, building your masterpiece from the ground up. This mortgage covers the cost of land acquisition and construction. It's a two step process. First you secure a short term loan to cover construction costs and once the house is built it transitions into a standard mortgage. The loan term is longer and interest rates vary based on multiple factors such as the builder project and market conditions. To recap, fix and flip mortgages are for short term property investments with the intent to sell quickly post renovation. Renovation mortgages are for property owners looking to enhance their current homes with loans based on post renovation value. Construction mortgages are for those starting from scratch, covering the cost of land and construction and transitioning into a standard mortgage once the house is built. Each mortgage type serves a different purpose and suits different needs. It's like choosing the right canvas for your next masterpiece. So whether you're a real estate investor, A homeowner looking to improve, or a Dreamer building from the ground up, understanding these differences can help guide your next big step in the property market.

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Sean Brown

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