Question about FHA 203K loan?
Ok so, these are loans that you get if you wanna buy a house that needs serious repair, right? So are they hard to get approved for? What is required of me to get one? Did you use this type of loan for your house?
I'm interested in a house that appears to need some work done on it and a friend of mine said that if we try to get it using a regular FHA loan, we won't get approved. But then she said that a 203K loan would be better, but the people are hard to work with? Just wanna know what to do. This would be our first home. Thanks.
- Anonymous9 years agoBest Answer
FHA 203k loans are not difficult to do if you work with a 203k experienced lender, a Realtor who knows the basics of the 203k and a Certified 203k Contractor. Otherwise, the 203k can be a bit more challenging than a regular FHA loan. And the 203k is NOT only to be used for homes in disrepair. Many buyers use the 203k just to upgrade the kitchen or to change the windows to be more energy efficient or to build an addition or even simple improvements like new appliances or paint. There is a great FAQ section at http://203kContractors.com. Check it out!Source(s): http://203kContractors.com
- 9 years ago
Keep in mind there are two type of 203k loans, the 203k streamline loan for repairs/remodeling up to $35k and the 203k standard for bigger jobs. Both are FHA loans and are processed the same as a normal FHA loan accept the appraisal process is different. If the home doesn't meet FHA or Conventional lending guidelines (health and safety issues such as broken windows) than you'll need the 203k loan to close the loan. All repairs are done after escrow closes, so you can buy the home in as-is condition. Get a lender that offers both 203k loans-very important. Fees for the 203k streamline are similar to a normal FHA loan and the rate may be .50% higher. The 203k standard can have $2k more in fees since there's more involved and the rate may be an additional .50% higher or so, but look what you get. A remodeled home to your specs and chosen colors in both cases. Using 203k contractors.com will help get a contractor who understands this loan-this is key. Most contractors and Realtors for that matter don't understand this loan so acceptance is lukewarm at best. Get a Realtor and contractor in your corner who understand it and you'll be better off. Don't let naysayers stand in your way this loan can work wonders in the right situation.Source(s): www.203khomeloanrehab.com
- 9 years ago
Like some of the other posters said, it is much easier when you work with an experienced lender. Primary Residential has an excellent 203k program. You can see a fun video here: http://www.youtube.com/watch?v=Y1bPtK5wmFg
You can find out more at http://primeres.com
- Lisa LLv 69 years ago
What people are hard to work for? These loans are not for the feint of heart. You have to get contractors approved, renovations approved & an appraisal that supports the value "as completed". Minimum 640 credit score. The rate will be higher. Closing costs will be higher. Renovations must be done within certain time frame of closing...that will be decided by mortgage company. You will really have to be on top of things to be sure it gets done in allotted time.