How do you qualify for a FHA rehab loan?
- Coffee DrinkerLv 72 months agoFavorite Answer
Have good credit, steady work history with income sufficient to repay the loan and minimal other debt, along with a decent down payment.
Then find a house that needs rehabilitation or repairs. Get professional estimates of how much it would cost to perform the repairs by hiring qualified, licensed contractors.
Get formal appraisals to prove the potential value of what the house would be worth after repairs.
Put together a proposal that shows the proposed purchase price and repair costs plus a buffer for unexpected findings during repair and show that the end result after purchase and repair will be a total mortgage balance below the fair market value of the home.
Make an offer on the home which is low enough to allow for repairs. Get the seller to accept, get an FHA approved loan broker to prepare the documents and get underwriters to approve the loan. Sign papers, wire your down payment to the title company, become the legal owner, hire licensed contractors to perform repairs, get the repairs inspected, pay contractors from the loan funds then finalize the loan and convert it to a standard FHA loan or refinance it to a conventional loan.
- linkus86Lv 72 months ago
Step one is to contact a lender that provides FHA loans. The big banks are often best and most experienced to work with on FHA. Like other FHA loans you will need to have zero late payments in the past 12 months and have very little derogatory debt (debt you have blown off or forgotten about) which is the most common hurdle to qualify, but the loan officer can look at your situation and advise you on anything else you need to accomplish. Good Luck.
- 2 months ago
good credit score
- Anonymous2 months ago
Go Google it. Then come back here if you have specific questions.