You don't hear about it very often but the FHA 203K Loan has been around since the 1970's. The reason you don't hear about it very often is either because the borrower is dealing with an in-experienced loan officer who just don't know about it, or doesn't want to make extra work for himself during the time of the close. It's an amazing loan and it's all I do here in the beautiful state of Colorado.
You either PURCHASE or REFINANCE with this loan and here's how it works:
You can roll in the comprehensive repairs to be completed by a general contractor and subs into your loan amount. Simple as that.
A single contractor can coordinate a remodeling of a room, area, or entire home with multiple jobs. Whether you are planning to add a bedroom, bathroom, deck, or maybe a new kitchen, any additional square footage can be all included in to one low interest rate. This interest rate is only between 4.875%-5.625%. Not bad right?
Let me give you an example of a deal I just got done working on. The buyer purchased a home for $290,000 and the home had some problems with the foundation it rested on and it was causing a bunch of other problems.
The FHA HUD Consultant estimated the repair work to be roughly $110,000, so the new loan which needed to be abide by FHA County Limits, is maxed at $406,205.
The cost per square foot in this particular area of Denver is a little over $210. The property is 2800 sq feet. That will justify an after appraised value of $588,000. WOW!
Now the buyer could look forward to a profit of over $180,000 even if he decided to sell the property in 6 months!
You either PURCHASE or REFINANCE with this loan and here's how it works:
You can roll in the comprehensive repairs to be completed by a general contractor and subs into your loan amount. Simple as that.
A single contractor can coordinate a remodeling of a room, area, or entire home with multiple jobs. Whether you are planning to add a bedroom, bathroom, deck, or maybe a new kitchen, any additional square footage can be all included in to one low interest rate. This interest rate is only between 4.875%-5.625%. Not bad right?
Let me give you an example of a deal I just got done working on. The buyer purchased a home for $290,000 and the home had some problems with the foundation it rested on and it was causing a bunch of other problems.
The FHA HUD Consultant estimated the repair work to be roughly $110,000, so the new loan which needed to be abide by FHA County Limits, is maxed at $406,205.
The cost per square foot in this particular area of Denver is a little over $210. The property is 2800 sq feet. That will justify an after appraised value of $588,000. WOW!
Now the buyer could look forward to a profit of over $180,000 even if he decided to sell the property in 6 months!
About the Author:
To learn more about the Rehab Loan Standard Loan contact Brian Quigley, Colorado Mortgage Specialist .
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