FHA 203k Program
FHA buyers, did you miss out on the $8000 tax credit? Well here's another opportunity to get into a lower priced home, possible foreclosure that needs work, without having to have the money to do the rehab project. The FHA 203k program allows an owner occupied borrower to purchase a home that needs work. The FHA loan will finance the cost of the repair project up to a future appraised value.
For example: If you were to purchase a foreclosed home for $100,000, but the home needs $50,000 worth of work to be up to your expectations. The FHA will do two appraisals, one for current price and one for the future value after the project is complete. If the homes future appraisal is $150,000 you can then finance the whole project with only 3.5% down. You would close on the sale with a loan for $100,000 to purchase the house, then the $50,000 for repiars would be held in an escrow account. As portions of the project are completed, you can draw from the $50,000 to pay yourself or a contractor that does the repairs. This continues until the project is complete. You have 6 months to complete the job. At the end you will have the house completed the way you want and a new loan for $150,000 with the 3.5% down payment!! Call me for more details.
Program Highlights:
* Owner Occupied (1-4 Units)
* FHA Loan Limits - $365,000 in the Twin Cities
* Borrower Can Be Their Own General Contractor
* No Reserves (i.e. no minimum checking/savings account balances) Required (1-2 Units)
* Borrow Up to 97% of the value of your home AFTER the improvements are figured in
* Regular FHA 30 yr rates apply - currently in the low 5's
* 620 Minimum FICO credit score
* Up to $35,000 for Non-Structural Repairs:
* Renovate Kitchen
* Renovate Bathrooms
* Flooring
* Windows & Doors
* Exterior Siding
* Septic & Well Repair or Replacement
* Repair/Replace/Add Deck or Patio
* Purchase & Install Appliances
* Roof, Gutters & Downspouts
* Finish Basement (no structural repairs)
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