An FHA 203k loan is an awesome program if you are planning to purchase a Texas foreclosure that needs a little rehab work.
Even though there are some great deals on Texas foreclosures, most of my clients are hesitant to explore that option due to the amount of repairs and initial investment involved with purchasing a bank owned property.
Here are three great reasons to consider an FHA 203k loan while looking for new homes with your Dallas real estate agent:
1. You keep your cash and roll the cost of the repairs into the loan (*up to $35,000) for 203k streamline and for a full 203k loan the amount can go much higher.
2. One loan with a great low fixed rate.
3. Low down payment.
BONUS – Can also be used to renovate an existing home.
*Disclosure – There are obviously qualifying guidelines associated with the Texas FHA 203k mortgage program, but we can personally go over your individual financial plan and scenario on the phone or at my office.
There are some differences between the Full 203k loan and the 203 k streamline. When you think about the 203k streamline loan think light cosmetic renovating such as carpet, paint, remodeling a kitchen or a bathroom. Other popular projects have included upgrading to granite counter tops, adding hard wood floors and changing out light fixtures. Maybe you want to upgrade and have all new windows and doors in your new home. All of this is a synch with an FHA 203k streamline loan. Now especially in Texas the 203k loan is great because it allows for the fixing ( just had to throw that in there) of foundation and roof issues and makes them a non issue!
In regards to the interest rate it is a low FHA fixed rate and typically runs about .250% higher than the traditional FHA 203b loan. The interest rate on the renovation loan is a bit higher simply due to the fact that it is a niche product and is allowing the buyer to roll in repairs that will be completed after closing. If you have checked into home improvement loans you will find the 203k rate is much more reasonable.
And saving the best for last is the low down payment. Just like the traditional FHA loan the down payment on the 203k loan is only 3.5%! This is a great way for a prospective homeowner to buy a home as is with a great low rate AND roll in the cost of renovations. FHA has one of the lowest down payments that are available in today’s market. With this low down payment requirement buyers are not having to drain the savings account but able to keep some cushion in the bank.
Most loan officers still think that a 203k loan is difficult to qualify for, however, things are much different now. I have just discussed the 3 top reasons an FHA 203k loan is awesome but there is so much more. Feel free to email or call if you have any specific questions about how easy this program really is.
[box type=”info”]Related Posts[/box]
[related_posts limit=”3″]
[fblike]