Need advice from a property appraiser

[BigCountry1689]

I am looking to do a Refi to do 2 major projects. I want to put in a new barn for the wife and a front porch on the house for me. The barn will be about $30,000 and the porch about $20,000. I can only borrow 80% LTV so I have to do one project first then Refi again and do the next project as I don't quite have enough equity to pull both off at one time. So my question is which project is going to maximize my money and return me the most LTV. I am asking this more from an appraisal stand point than a resale. I say this because I talked to my realtor that sold us the house and she wasn't much help, she could only tell me comps and what she thought was resale value. But I don't think that is going to be the exact equation the appraiser uses reading through the initial appraisal. I did try to call the company that did the appraisal for purchase but they told me the only thing they could do was a "soft appraisal" and review the plans and provide me with an estimate but that was $400. Also from the appraisal stand point does the porch add to living SQ footage or not. It will be 15ft(D) X 32ft(L), Stamped concrete, Tongue and groove ceiling and rock fascia, with a metal roof essentially an outside living area. Thanks for any input.

 

[kthompson]

Did you check the regulations on a Home Equity Loan? They may go higher than 80% with it.

 

[BigCountry1689]

I had looked at the home equity loan but I was able to get 3.25% on the Refi and I don't remember exact but I think it was somewhere around 5.25% on home equity loan.

 

[BigCountry1689]

Oh and I am also trying to refi out of the PMI I forgot to mention that part.

 

[JMER817]

Neither option is going to give you the bump in home value that you need. Appraisers only give you about $10k for a pole barn regardless of what you have into it. A porch I imagine won't give you much more. All these appraisers do is plug figures in a computer spreadsheet. None of them look at the extras such as concrete, high end Windows, acreage, higher r value insulation, 2x12 vs 2x10 floor joists, plywood vs osb, 9' basement walls vs 8', 0.040" thick siding vs 0.035", 40 year shingles vs 25 year...I could go on. All they look at is number of bedrooms, baths, and sq footage. Can you take a loan out on your 401k if you have one?

 

[BigCountry1689]

Neither option is going to give you the bump in home value that you need. Appraisers only give you about $10k for a pole barn regardless of what you have into it. A porch I imagine won't give you much more. All these appraisers do is plug figures in a computer spreadsheet. None of them look at the extras such as concrete, high end Windows, acreage, higher r value insulation, 2x12 vs 2x10 floor joists, plywood vs osb, 9' basement walls vs 8', 0.040" thick siding vs 0.035", 40 year shingles vs 25 year...I could go on. All they look at is number of bedrooms, baths, and sq footage. Can you take a loan out on your 401k if you have one?

It appeared that way when I was reading the appraisal sheet. I was hoping that the porch would add to living square footage thus adding to value. I have a pension so no borrowing on that. I don't really want to borrow against my 457B that is my emergency scenario. If it becomes a forced issue I can do the home equity but then I would have to refi out later with the hope that the refi will come in at value.

 

[EddieWalker]

Neither option is going to give you the bump in home value that you need. Appraisers only give you about $10k for a pole barn regardless of what you have into it. A porch I imagine won't give you much more. All these appraisers do is plug figures in a computer spreadsheet. None of them look at the extras such as concrete, high end Windows, acreage, higher r value insulation, 2x12 vs 2x10 floor joists, plywood vs osb, 9' basement walls vs 8', 0.040" thick siding vs 0.035", 40 year shingles vs 25 year...I could go on. All they look at is number of bedrooms, baths, and sq footage. Can you take a loan out on your 401k if you have one?

I was thinking that the porch would give you more value to your home then a barn, but after reading this reply, I'm inclined to agree with it. You might want to talk to your loan officer and see what they say about this. Some are very willing to work with you to make a loan happen and come up with ideas you might not have considered.

 

[NorTracNY]

My experience has been very different than JMER. Our town thinks my barn is worth more than I paid to have it build 14 years ago! The porch is next to nothing and doesn't add the the square foot of living space. I believe it would have to be fully enclosed and heated to do that. I'd also NEVER borrow from your 401K. It is better to get a personal loan than do that. There are tax hits and lost investment cost that rarely ever make sense. My tax adviser shakes her head every time one of the clients does it.

 

[Rock knocker]

I want to put in a new barn for the wife and a front porch on the house for me

Not for me to judge your living arrangement, but who's going to live in the house?

 

[BigCountry1689]

My experience has been very different than JMER. Our town thinks my barn is worth more than I paid to have it build 14 years ago! The porch is next to nothing and doesn't add the the square foot of living space. I believe it would have to be fully enclosed and heated to do that. I'd also NEVER borrow from your 401K. It is better to get a personal loan than do that. There are tax hits and lost investment cost that rarely ever make sense. My tax adviser shakes her head every time one of the clients does it.

No that was not an option for me. Don't like playing with my old man money.