Anonymous asked in Business & FinanceRenting & Real Estate · 1 decade ago


I looked at DOZENS of houses and all the ones I really liked that didn't need work I either got out bid or didn't act fast enough. Now I found another one I sorta like but it needs some work. I would say a new furnace, drywall needs repaired, and needs some carpet, and windows.Main repairs to the home is around $4300. My realtor keeps telling me that FHA 203K loan will not approve it because most of the work is cosmetic and damages are less then $5000. I'm told I would have to pay upfront for two apprasials and for a FHA consultant to examine and write up a estimate for repairs. She says it would be cheaper for me to pay for the repairs myself then tacting on another $5k to the final sale price which would only make my payments about $30 more.

It says on Huds website that it's 203k are eligible for structural alteration and reconstruction and changes for aesthetic appeal, plumbing, heating/electric upgrades and even carpet and appliances..etc & that appraisals fees can be worked into the loans.

My main question is:

1. Will FHA approve the house as is (livable)condition if the furnace doesn't work and with drywall holes in the wall?

2. Is 203k loans restricted to only major damage and cannot be used for updates such as windows, carpet, appliances unless their is damage that exceeds the $5000.

3. Would I have to pay upfront for 2 apprasials & FHA consultant or could that be added into my loan?

4.Should I get rid of my agent?

3 Answers

  • 1 decade ago
    Best Answer

    You know what--All of this is very important information for this site and something a lot of people want to know about. The FIRST thing you have to do, is go and talk to a lender. Call first to find one that will do an FHA rehab loan. They can answer all of your questions. Ask lots of questions. The banks or Credit Union themselves, may have foreclosed properties they can offer you with special financing options..

    By shopping for homes first, you are putting the cart before the horse. You always need the financing paperwork first. Once you have that information, you will know whether or not to get rid of your agent. Whether or not she was correct in the things she told you.

    Please come back and tell us about it and what happened.

  • Anonymous
    1 decade ago

    get rid of your agent,, when I bought my house it was not finished either,, but the loan company required I put a certain about into escrow to use to finish the house.. there was only 1 bedroom and the kitchen finished.. siding wasn't all on, the house was 2 years old,, I put the money the escrow account and finished as I could afford more money to add the bells and whistles that I really wanted in the home..Also,, why are you using FHA? they have way to many restrictions on a loan.. my suggestion is go to a regular loan company or VA if you can.. And you do have to pay for the appraisals,, and shop around there too,, Don't listen to your agent,, cuz most of the time, it is one hand washes the other.. If you find your own,, you could save yourself hundreds of dollars,, go to the yellow pages and put it up on bid...

    Source(s): personal life..
  • 1 decade ago

    Your understanding of the HUD website is correct. The 203K loan is acceptable for the house you describe.

    A regular FHA loan will not approve a house with a nonworking furnace and unlivable conditions.

    You have to pay for the 2 appraisals in cash. You can finance a home inspection but that is not an appraisal.

    Most buyers are extremely unhappy with their 203k experience. HUD controls all repairs. Not you. And most buyers have a definite idea of what they want to do. HUD is involved in every step of the repairs. That is a nightmare unless you find a HUD office that is overstaffed and underworked ( the opposite will be true).

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