FHA 203K Loan

Want to buy a fixer but don't have the money to fix it up? Here's a solution. Finance your purchase with an FHA 203K loan. You borrow the money to pay for the house and you add the amount it will take to fix up the house so the total amount borrowed is the price for the home plus the amount to fix it up.

Here is an example. A buyer looks at a foreclosed home which is on the market for $75,000. The furnace is broken, the roof needs to be replaced and the bathroom needs updating. But otherwise it is exactly the home the buyer wants and is located in the area they want. They need about $20,000 to fix it up and they don't have it. The loan they obtain is $95,000. The buyer still must qualify based on income and credit qualifications. When the home is appraised, the appraiser sets the value at what the home will be worth once the improvements are completed. The buyer obtains estimates on the work and submits these to the bank. The bank holds the money to pay the contractor and as the work is completed the contractor is paid.

The buyer can still obtain a loan with as little as 3.5% down. And if you want to refinance and fix up the home you already live in, you can do that with the FHA 203K loan. Here is an opportunity to buy a home you otherwise may not be able to afford.

You can always email me with questions. Want to search properties currently on the market? Go to my website at http://donnawheeler.edinarealty.com/.