203(k) Loan Info
the FHA 203(k) loan. The FHA 203(k) is a loan that is secured by the Federal Housing Administration that is used by borrowers for the purpose of fixing up or rehabbing real estate.
Some of the advantages of a FHA 203(k) loan are:
· borrow up to 110% of the after
completion value of the property
· take out one loan to cover a property's
purchase price and cost of rehab
· refinance existing housing
· finance 100% of the cost needed to
improve property
· and much more.
To apply for or learn more about the FHA 203(k) loan contact your local FHA approved lender.
Some of the advantages of a FHA 203(k) loan are:
· borrow up to 110% of the after
completion value of the property
· take out one loan to cover a property's
purchase price and cost of rehab
· refinance existing housing
· finance 100% of the cost needed to
improve property
· and much more.
To apply for or learn more about the FHA 203(k) loan contact your local FHA approved lender.
Comments(0)
Daniel,
Thanks for that info! I usually flip my deals but it might happen that I find one I want to do myself.
Mel
Daniel, Can you tell me what the criteria from FHA on the borrower? Credit status involved? Where do I get more information on the 203k?
Do mortgage brokers know about 203k program?
Daniel,
I'm coming to the end of my 203k and I'd have to say that you need to tell these people the potential pitfalls in this type of transaction.
First off the loan is not for investors. It's for owner occupied only. True you can commit loan fraud but that would depend on if your willing to take the risk.
Second I've never seen this much paperwork and players in my life when dealing with a loan. Just to name a view. The lender, The realtor, Appraiser, Hud Consultant, Real estate Attorney, Termite inspector, Hazard insurer and the long list of contractors.
"Why the long list of contractors?" well I don't know about you but finding a contractor that is willing to start work with NO money down is hard to find. That's right no money can be drawn unless an amount of work has been completed, with few exceptions. Insurance??? Yea try getting insurance for an unhabited home that needs work and prepare to pay through the nose till the construction is done and the value of the home is more then at least a car (unless your going for a more expensive home to begin with) I'm about a week past my set close date at this point because of some of these unknown goodies I didn't know about. which means I'm paying a per diem penalty for everyday I don't close. This fee is normally 50 dollars a day but because of this type of transaction it's 100 dollars a day! If you're new to real estate like I was and still are I would suggest you stay away from this loan and go with hard money instead.
NewbieJ,
Perhaps it has something to do with the lender you dealt with, but the FHA itself will insure a loan under the 203(k) program for investment purposes. It says so right on the hud.gov site. Your lender might have had specific requirements aside from that. Can't say. But you would be misinforming the rest of the readers by saying that it can't be used for investment.