Some of the best opportunities for homebuyers to secure a “big time” deal in today’s housing market often gets trumped when an appraisal comes back requiring a major item to be addressed and repaired; or the home requires extra repairs that exceed the homebuyer’s budget for their down payment. [Enter the FHA 203k Loan Program] A FHA 203k mortgage is ideal for the rehabilitation of both HUD owned homes, short sales, or REO (bank owned) properties. Basically, the FHA 203k loan program is nothing more than a FHA mortgage and a home improvement loan tied into one, 30-yr fixed mortgage loan. The 203k rehabilitation loan program is also a great tool for community and neighborhood revitalization.
Why Do I recommend the FHA 203k Rehab loan to my borrowers?
(1) The home is being sold “As-is” typically from the bank as a REO or short sale property, and is required to sell without repairs. In this case, the home would not pass the appraisal inspection for a conventional or regular FHA or VA home loan, and a cash purchase is the only option.
(2) Most homebuyers simply do not have the additional moneyon top of their down payment to put the repairs or upgrades into the home.
Some additional benefits for choosing the FHA 203k Rehab Loan are:
(1) Low down payment required – 3.5% down
(2) Lenient credit score requirements allowed – 620 min score
(3) Borrower can receive gift funds from family for the down payment
(4) Non-occupying co-borrowers are allowed
(5) You can use the $100 down HUD program with the 203k rehab program
(6) The seller can still pay up to 6% toward closing costs and buy down costs
(7) Owner-occupied financing for up to 4-unit properties, PUD’s and condos
(8) You can borrow up to 110% of future appraised value
There are many other great reasons why this loan program is a great choice, especially in the REO, short sale, and foreclosure market that we are in today. Contact your Realtor today, and make sure they understand how turn-key this loan program is with Dan Keller and his team of Seattle FHA and FHA 203k experts.
For a detailed look at this program, you can view my powerpoint presentation that I designed for realtors, homebuyers, sellers and Asset Managers to better understand the great resource we have available to us courtesy of HUD and FHA!
If you are a Realtor, I am happy to show you how this program can add tremendous value to your sellers and buyers. Let me and my team take the burden off shoulders and walk you and your clients through the entire transaction in less than 45 days (regardless of the rumors you’ve heard about 60-70 day 203k closings…).
For more information contact: