Posted by Rich on February 06, 2001 at 14:25:12:
Hmmm. Will a lighter do?
- Rich
Do I have equity and How do I get it? - Posted by Gary
Posted by Gary on February 05, 2001 at 09:26:15:
I currently own a 2-family home located in New Jersey. The house was built 3 years ago. Most recently, my insurance company assessed the replacement value of the house at $340,000. I am the original owner and I paid $235,000 for the home. Can I safely assume that I have $105,000 in equity? and What is the best way to tap into it for future purchases of rehabs?
Re: Do I have equity and How do I get it? - Posted by Ed Garcia
Posted by Ed Garcia on February 05, 2001 at 09:53:11:
Gary,
In most cases, unless you want to go for a 125 which is crazy, most lenders will do what we call a CASH OUT at 80% LTV (loan to value). 80% of $340,000 is $272,000. Deduct your first mortgage of $235,000, and that gives you $37,000 lend able equity.
I think is you borrowerd any more, you would be jeopardizing the integrity of your deal.
Ed Garcia
Re: Do I have equity and How do I get it? - Posted by JohnBoy
Posted by JohnBoy on February 05, 2001 at 19:28:12:
Isn’t an insurers assessment of “replacement value” based on what they estimate the cost would be to rebuild should the home be destroyed and not so much what the actual market value is?
Doesn’t it usually cost MORE to rebuild the same house vs. buying an existing one? If this is the case then I would assume the property would probably appraise for less if it were appraised by a home appraisor for the purpose of FMV for selling the home vs. cost of rebuilding it. Am I off on this where a lender would accept an insurance company’s assessed value based on replacement costs to borrow against?
Re: Do I have equity and How do I get it? - Posted by Rich
Posted by Rich on February 05, 2001 at 18:26:15:
Hi Ed,
I’m going to call you later, but I saw this note and had to write. My commercial property that I paid $65k for was assessed by my insurance company at $350k. Does that mean I have $285k in equity?
- Rich…getting ready to head to CA, if they can keep the lights on.
Re: Do I have equity and How do I get it? - Posted by Ed Garcia
Posted by Ed Garcia on February 06, 2001 at 13:48:12:
JohnBoy,
You’re right. To be honest with you, it was an over sight on my part. I just took for granted that the value was estimated, weather it be by a comp, appraisal, or what ever, I was answering his question as to, how do they determine how much lend able equity he would have in the deal. JohnBoy, you’re getting picky in your old age,
(smile)
Ed Garcia
Re: Do I have equity and How do I get it? - Posted by Ed Garcia
Posted by Ed Garcia on February 06, 2001 at 14:01:31:
Rich,
You and JohnBoy are getting tuff.You try to answer as many questions as I do, and not go crazy. It was a over sight on my part Rich. I was so ingrossed in answering the question, I missed how he was determining the new value. I now know with you and JohnBoy around, I better not miss anything,
(smile )
Ed Garcia
Re: Do I have equity and How do I get it? - Posted by JohnBoy
Posted by JohnBoy on February 05, 2001 at 19:29:18:
Pssst! Want some matches??? LOL