Ryan Lee just sent me a great set of guidelines, something I’d almost forgotten about… until today. The FHA 203K program can be compared to the single close construction loan. For qualifying borrowers & homes one can borrow more than the purchase price for a home, with the balance placed into an interest bearing account. The money can be then used to complete the repairs on the dwelling.
This program is perfect for those wishing to get a fixer upper without the liquid cash to perform needed repairs.
There are some specific requirments, so working with a reputable lender is key. A few of the main constraints:
- Home must appraise at a value (with intented repairs) at an amount sufficient for the loan to value ratios of the program
- No self help (bummer huh?)
- No more than 2 contractors (contractor must also be an FHA approved contractor)
- Payments subject to final appraisers walk through for dispersement of funds
Other than that – simple as pie! This program may bode well for a distressed bank property needing paint or a new roof to pass inspection. Amazingly this program is also available in a streamlined refinance for current homeowners needing a refinance to make needed repairs.
Please be sure to contact us if you’d like more information about this great product!