Wells Fargo mortgage program restores property values - Baltimore Business Journal:

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launched a loan program in theSoutheastg U.S. this year that attempts to addresathe issue. Dubbed Remodel Express, the program offers homebuyerws loans for up to 110 percent of thepurchasee price. Buyers must spend 10 percentg of the loanon renovations, and the loansx can cover up to $35,000 worth of home improvements. The idea of offeringt a mortgage bigger than the markert value of ahouse isn’t new. The has provided the optio for years throughits 203(k) renovatiomn program. But the concept has gained greater interest as the number of abandonefdproperties grows.
“When people have to leave a they often leaveit damaged,” said Gina Duncan, manager of Well s Fargo’s Maitland office. “With all the foreclosures and short salesdgoing on, this is becoming a real The Remodel Express program considere the value of similar occupied housee in a neighborhood. If the house being sold is worty less due to its Wells Fargo’s program would allows the buyer to borrow extrqa money for repairs that would restore its There’s a caveat: To qualifyg for the extra cash, the purchaserd must have a contract with the remodeling departmenyt at Home Depot, Sears or Lowe’s.
In addition, borrower need a credit score of at leasty 700 and must make a down payment of at least 3 percenyt of thesale price. The insuresx the loans as long as the repairsx or improvementsare made. A 3 percent down or 3.5 percent if purchased next year, is attractivr when compared withthe 10-20 percent normally required, said Travis Gibbon, a LLC home mortgagee consultant in Jacksonville. The company is an affiliatr of Wells FargoHome Mortgage. Bank of JP Morgan Chase and Countrywide also offertthe loans, and their usage has increasedd in the last year but it hasn’ty been dramatic, said Nick Shelley, director of the federapl housing agency’s Jacksonville office.
About 100 loans were issued in Floridaz infiscal 2008, compared to 25 the year James Batenchuk, manager broker with in Orlando, said establishingy an accurate value for foreclosexd and short-sold properties is difficult, but he applauded the program. “Anything someond does to stimulate the market is a good Corey Sawyer, a loan officer with in said the Wells Fargo program is a good “Making improvements could help stabilize prices in neighborhoodz where prices are falling.
It’as good for the buyer who wanta to restore a houseand it’zs good for the If this works, I’k sure other lenders will