Buying an old house to fix up
has an attraction for many people. If you can find a house with charm and
character, a renovation may enable you to create just the living environment
that you want. You should start with a good Realtor to help you locate the right
house and recommend lenders who make both acquisition and construction loans.
Financing a renovation is perhaps the most
difficult part of the whole project, especially if the house needs extensive
work. Few banks will make these loans to people who are not professional
developers. You should prepare for your loan application by having a written
proposal. It helps to have an engineer's report or architectural plans and to
include estimates from contractors covering the costs and timetables for the
work to be done. Your Realtor can help you put together a market analysis of the
neighborhood to show that you will not be over-improving the property compared
with other homes in the area.