How’s this for a Catch 22?
You’ve found a great property. Perfect for your needs, and in just the right location. It could use some fixing up, but that’s OK because it brings down the price. Besides, you like the idea of customizing a home to make it truly yours.
The problem is that the bank won’t lend the money until the repairs are complete. And you can’t buy the house until you do the repairs.
Fortunately, there’s a loan program in place, backed by the Federal Housing Administration, meant to alleviate that very problem.
The FHA 203(k) is perfect for enterprising homebuyers who are willing to pay a lower price for houses that need some sprucing up or repair work, and willing to arrange for that work themselves. Depending on the type of 203(k) loans, they can be used to fund anything from minor touch-ups to major renovations.
The program has been around for decades, but under-used for much of that time. It’s becoming increasingly popular among homeowners who see the value of putting instant equity in their homes, and like the idea of customizing a property to suit their needs.
You can purchase or refinance a property, and include in the loan the cost of making repairs and improvements with as little as 3.5 percent down.
With this program, you can rehabilitate or improve an existing one-to-four-unit residential property. One of those units must serve as your primary residence, though you can rent out the others in multi-unit homes.
95 percent of lenders are unable to offer 203(k) loans. AnnieMac Home Mortgage has made them our specialty. We have an entire team dedicated to processing them. If you’d like to talk about the possibilities, feel free to schedule a no-cost consultation with one of our Licensed Mortgage Originators