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Old 02-02-2010, 10:06 PM
 
2 posts, read 8,437 times
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My husband and I moved to knoxville in November. We are currently renting and are anxious to find our own home. My husband is quite handy and very capable of remodeling a fixer-upper. However, it makes more sense to me to purchase an unfinished new construction home and finish it to our liking. The problem I'm having is that I don't know how to find these unfinished gems.

We saw one go very cheap at an absolute auction, but those seem to be very few and far between. Anyone have any ideas where to find a contractor that needs to "unload" a project from his plate? Or maybe there is a separate foreclosure list for construction loans that I might be able to get ahold of?

We would appreciate any help you could give.

Oh yeah... we are looking to buy in the Hardin Valley, Karns, Lovell Rd, Cedar Bluff area.
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Old 02-03-2010, 12:10 AM
 
Location: The Conterminous United States
22,584 posts, read 54,456,517 times
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Yes. There are three homes that are in foreclosure in that area that are listed as under construction. However, only one looks like it is actually unfinished. You would have to talk to the bank to see if they would sell it that way. Unless you are paying cash, I don't really see that happening. I'm not sure that they would finance an unfinished home. Contractors get special commercial builder financing.
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Old 02-03-2010, 12:13 AM
 
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How do I find out which three those are? We are still trying to figure out how to finance it.
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Old 02-04-2010, 10:42 AM
 
Location: East Tennessee
374 posts, read 949,408 times
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Default Buying partially finished

Quote:
Originally Posted by hiknapster View Post
Yes. There are three homes that are in foreclosure in that area that are listed as under construction. However, only one looks like it is actually unfinished. You would have to talk to the bank to see if they would sell it that way. Unless you are paying cash, I don't really see that happening. I'm not sure that they would finance an unfinished home. Contractors get special commercial builder financing.
new construction is a pretty big risk for the buyer and lender. Hiknapster is exactly right.

About two years ago my hub and I made several inquiries about buying/financing an unfinished new construction home. It was a great deal, great location - looked perfect... on the surface. I can tell you, it is extremely difficult, even under ideal circumstances. After going through the process, I certainly can understand the risk a bank would take to finance something like that. I would guess that in a foreclosure situation, it might be even more difficult, given the risk of unpaid sub-contractors appearing with claims/liens. Depending upon the area where the house is built, documentation for permits and good inspections would be vital. And, remember that not all counties in the E TN area require permits OR inspections to build a house. If someone owns the property "free and clear" just about "anything goes" in many areas. After long consideration, we decided that if we had the cash to finish construction, it MIGHT be a good plan, but we still had the risk of no foundation/construction guarantee for the work that was already done and the septic permit/inspection was "fuzzy." Since we didn't have enough "handy" cash to complete construction, and could not find a bank aggreable to assume the (already constructed) construction risk, we passed on the deal.

Before you take on purchasing a partially completed new construction home, there are LOTS of considerations and risks. If you, your hub, or family member is a certified contractor, not just a handyman or remodeler, then it might warrant undertaking. Otherwise, think long and hard. There are many, many good deals and opportunities to remodel existing construction and still have a wonderful home.

Good luck!
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