Metro Pulse/Urban Renewal

Wells Fargo Purchase and Renovate Loans
Contact: Jeff Talman
Renovation Specialist
690-2721 [email protected]

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by Matt Edens

An artsy, funky young couple who spend their nights and weekends scraping paint and stripping wallpaper—it's the classic image of the "urban pioneer." Why is that though? Why the obsession with sweat equity? Well, as someone who's spent a weekend in August mucking around in the basement with a 20-ton jack (and has the hernia scar to prove it) it ain't because it's fun, that's for damn sure. Nope, when bootstrapping a run-down house or a run-down neighborhood, sweat equity is at a premium because equity of the regular sort is often mighty hard to come by. Sure, restored houses in 4th and Gill may be tipping the scales at as much as $200,000 these days and banks may be lining up to hand out mortgages, but it took a whole lot of folks in the '80s and '90s with maxed-out credit cards to get it there.

Fortunately, that's changing. Not only are our local banks slowly beginning to realize the potential of the center city's historic neighborhoods, now a new player on the scene—Wells Fargo—has considerably upped the ante. One of the oldest publicly traded companies in America, Wells Fargo has come a long way from the stagecoach business. The company's a leader in mortgage financing and, with a 30 percent share of the market, it's hands-down the nation's largest renovation lender. And now, Wells Fargo has brought its experience and considerable reputation to the Knoxville market. Which is a good thing, according to long-time center city advocate and recently hired Wells Fargo renovation specialist Jeff Talman. "To crack the nut of urban revitalization 75 percent of the battle is access to resources," says Talman.

And, with more than 16,000 pre-World War I (that's right, WWI) housing units—most of them a little down on their luck, like this trio of fixer-uppers on Washington Avenue in Parkridge—we're not talking chump change for resources. No matter how hardcore a do-it-yourselfer you are, there's a limit to how much Home Depot will let you put on the Visa.

Which is where Wells Fargo's Purchase and Renovate loan program comes in. Combining purchase and construction costs into one simple package, it can make buying and restoring a historic home accessible to folks who don't aspire to be Bob Villa or Martha Stewart. "You don't have to be a handyman," says Talman. "This is geared towards hiring contractors and an architect."

By basing the loan on the estimated post-renovation appraisal, spreading your renovation costs over the entire term of the loan and making interest on renovation costs tax-deductible, you don't have to be Daddy Warbucks either. If you've already started down the road to your own personal money-pit nightmare, there's hope there too. Wells Fargo can cash out credit card debt, refinance your purchase and construction loans and "roll it into one loan, one closing—badda-bing badda-boom," Talman says.

Of course, there's more going on here than merely fixing up houses. And for Talman, who calls himself a "social capitalist," it's the chance to create a little wealth in the center city that's the program's real kicker. Say you pick up a house with a few rough edges for $50K, spend another $50K smoothing them out and wind up with a place that's appraised at $120,000. Well that's $20,000 worth of instant equity—equity that can go towards starting a business or funding your children's education. Oh, and by fixing up that run-down house, you've boosted your neighbors' bottom line too. Or, as Talman puts it: "This is my own little empowerment zone effort, connecting people to resources, helping them realize their dreams, fill in holes in neighborhoods, create capita and increase the tax base—that's what I signed up for."