Anyone who has been in the market for a new house will totally relate to this. First they casually start looking online or on mobile apps that all start to blend together, creating profiles to do Multiple Listing Service (MLS) searches on websites from agents all over who ultimately hope to be able to be of service to the prospective buyer, and saving listings that look like their dream home based on the enticing remarks and fantastic photographs that sometimes rival a beauty photo shoot. It then moves on to the "just looking" at open houses on Sunday, with a list of houses to preview over a three-hour tour around anywhere from one to four towns before choosing an agent who they connect with or were referred to for helping them navigate the house-hunt and entire process as smoothly as possible. These buyers soon realize that the new "c" word in marriages, partnerships, and live-in relationships has moved from "commitment and communication" over to a new level: compromise.
A house becoming a home is definitely a huge investment emotionally as well as financially. It's your haven, your safe space, your retreat. It's meant to be a reflection of yourself, your lifestyle, and your vision. So if the vision that you have of yourself is an energetic, trendy, well-heeled, and sophisticated individual of the times, but all your wallet allows for the area you're focusing on is a tired, dowdy, and out-dated house with features and colours that were stylish around the Blizzard of '78 or even back when women were first allowed to vote in the U.S., that "C" word of compromise may be a regular part of your vocabulary during the house hunting process. I've often likened the MLS to sometimes be like online dating for houses: they sound great on paper, but just don't always match up to the expectations.
As long as a house has great bones and structure, many can perceive the concept of "making it your own" as a fun project, at first anyway. There are countless home improvement shows on television, publications, websites, even browsing the paint aisles at local stores can be a way to pass a weekend when people get into the groove. More often than not do I hear from green buyers, "Oh, my (uncle, boyfriend, brother-in-law, friends who are contractors) are handy, we can do anything to fix it up for the right price." Little do these people know that their services are being offered out, and the number of projects become slightly overwhelming unless the buyers get re-focused and get the right direction from their agent.
Then much like the cost of a wedding hits newly engaged couples, so does the financial reality of home improvement to new buyers. Depending on what type of traditional loan program a buyer is considering, it's very possible that their savings are going to the loan itself or maybe the closing costs, or possibly one of the buyers is paying for the deposit and the other is saving their money for something other than the air mattress they've been "compromising" on since co-habitating. Or the house that they LOVE LOVE LOVE (yes, I've heard that expression many times working with buyers) is "the one", but unfortunately, it's been left in disrepair either by abandonment (ie: foreclosures that have been left alone too long, not to say that all foreclosures are in total disrepair because they are not) or just has been owned by someone who may have been older or didn't find a need to update it past the day they bought it because they were of the generation of "it ain't broke, don't fix it".
So how does one purchase a house that COULD be great, if they just had more money to fix it up?
Solution: talk with a loan professional who is experienced in (and I mean, experienced in, not casually exposed to the program that they heard about in their company's sales meetings) FHA 203(k) renovation loans. Also called Rehab loans or 203k loans, this loan program will allow qualified buyers to incorporate the house renovations into the mortgage rather than having to get a mortgage and then do improvements along the way when money allows. We all know those plans either start off with the best of intentions and then stop mid-way, or they become pipe dreams and the "compromise" comes in other ways if at all.
Of course, with all loan programs, there are restrictions, guidelines, and nuances. This is a very helpful and useful loan that has become increasingly popular even though it has been around a while. Therefore, it is especially important having a well-versed and very experienced loan consultant work with you on these types of loans, and in our area of Central Mass / Greater Boston, there are loan consultants who specialize in this kind of program, so ask your agent or attorney for referrals on whom to contact.
I suppose just like there are counselors for relationships that "need work, but have great potential", these types of loans and loan professionals are one and the same: for houses and the buyers who love them.