I am hoping someone can help a finance challenged soul such as myself with some information. I basically need the "who" part.
My desire is to finance our garage/guest house with a home equity loan to eliminate the construction loan costs. We have a mobile home now that must be removed upon completion of the garage/guest house which will be our temporary home until we build the main residence. The equity loan would be secured by our land which is valued at about $550,000 given recent sales on comparable properties. That I know is the hitch. Do you know of any bank or loan agency that loans on such? I am located in Northern California. Thanks, Mark
Well, you would think except that to date, I know of none that will issue one using land to secure the loan. I asked because in todays loan climate, it seems most anything goes. Even a bank officer mentioned I try and see if anyone would do it for that very reason.
You are right that the larger lenders don't like to secure against raw land, but you should be able to do a construction loan, basing against what the property will be worth once the garage and guest house are constructed and the mobile home removed.
If not, you might want to find a small local bank and try to get a non-conforming loan that they will hold in their portfolio. It means a higher rate, but at least you could do something.