An FHA 203(k) loan finances the purchase and renovation of a primary residence. Because they’re government-insured, 203k loans have more lenient qualification requirements.
It’s such a good idea, in fact, that the federal housing administration backs a specific type of loan – the 203k – to help buyers purchase and rehab distressed homes that might otherwise be hard to.
A borrower is NOT required by FHA or HUD to use a 203(k) Consultant or either a 203(k) Streamline or 203(k) Standard loan. It is, however, a good idea to use one because a consultant is (or should be) familiar with the process and what documents need to be prepared and submitted to the lender in order to close the loan.
A 203K loan is an ideal option if you are planning to renovate and sell on the property, to update your outdated home or purchasing a foreclosure. Only requiring 3.5% down,it is an attractive option for many homebuyers and can open up your options to consider different properties and ultimately lead to you getting the home of your dreams.
An FHA 203k loan is an FHA insured mortgage which allows home owners to borrow the funds needed to purchase or refinance the home in addition to the renovation costs needed to update or modernize the home.
If the property is damaged, though, most mortgage lenders won’t finance the purchase. That’s why some buyers are now turning to a specialized loan called a 203K, based on the future value of the house.
Qualifications For Fha Mortgage Loans FHA loans are the second most commonly used type of mortgage loan. They’re great for first time home buyers because of their low down payment of just 3.5%, and low credit score requirements. You can qualify for FHA with just a 580 credit score. You can have a 500+ credit score if you have 10% to put as a down payment.
FHA 203(k) loans are backed by the federal government, and are a great loan option for those who want to purchase a home and perform upgrades, repairs, remodel or customize to their needs and wants. A renovation loan lets you stay in your current home and neighborhood, learn more about how you can get the home of your dreams!
As 203K loan is a unique fha insured mortgage program, working with an experienced and knowledgeable loan officer from a reputable FHA approved 203K lender is critical. Follow the steps outline above and be on your way to the successful completion of the loan approval process and the renovation of your primary residence.
According to the FHA, "All persons who can make the monthly mortgage payments are eligible to apply" for a 203(k) loan. To find a lender in.
Fha Rate Chart The above table lists the monthly average rates for conventional and conforming, 15- and 30-year fixed-rate mortgages in the United States. Information on points can be found at the Freddie Mac website. source: mortgage rates