What’s great about the FHA 203k Renovation loan? Well I could talk for hours about it but why not hear from a recent client of ours that closed on an FHA 203k Renovation loan as a refinance.
Let me set the scene for you…We got their call one afternoon after their current contractor walked off of the job. After making sure no liens were on the home and all the bills were paid we were able to pick up where he left off. Since we were using the full version of the FHA 203k just about all of the work they wanted to do was allowed.
As a side note, had the home not been habitable or without a certificate of occupancy we still could have moved forward using the Fannie Mae HomeStyle Renovation Loan. Just think of it as the Conventional version of the FHA 203k loan which allows for a bit more flexibility depending on the state of the project.
Their work included a full remodel of the kitchen, common areas, bedrooms, expansion of the master bedroom, addition of a full carport and lots of great upgrades across the board. But before anything could start we had to level the foundation – luckily the full version of the FHA 203k allows for foundation work.
Within a matter of about a month we were able to pay off their current mortgage, through the refinance and escrow about $100,000 for a whole home remodel. What an amazing transformation for a great family!!
Home was purchased for $180,000 in its current condition.
Renovation total was $100,454
After improved value was $290,000 – based on scope of work and plans provided to the appraiser.
They were left with about 7% equity which was a great ending however had the appraisal not been as good as it was the FHA 203k loan allows financing up to 110% of the after improved value so we would still have been able to move forward!
Check out this kitchen – it’s a total transformation! Our favorite parts were the back splash and the marble island. Of course our client had a few things to say too:
“Ohhhh I do love my kitchen. I spend so much time in there and I just love all of the counter space, and everything else. I also love the new bigger windows. The house was always so dark inside because we have low ceilings and the windows were small…I LOVE LIGHT!!!! I love the look of the garage doors and the breezeway :-)”
Here is an interesting thing to note, they had a fully functioning pool but it just didn’t look inviting. Luckily under the FHA 203k Rehab loan there are very few limits as to what you can do to the surrounding area of the pool. When it comes to actual pool repair we are limited to $1500 but in this case the pool was in great shape. It just needed a facelift…which it got. Now there is a safety fence, fresh pool decking and comfortable chairs. They are going to enjoy it this summer!
By lightening up the outside of the house and repairing the stone work, they have a very inviting back yard leading to the pool featured above. As you also saw in the photos above they poured an entire new drive way. Our client mentioned:
“My girls love the driveway…bicycles and sidewalk chalk are their new best friends!!”
As you can see there are many, many possibilities with the FHA 203k Rehab loan. One question I get a lot is how am I to live in a house undergoing this much renovation. Guess what, you don’t have to! If the 203k Consultant deems the home uninhabitable during construction we can finance some of your mortgage payments!
From purchase to refinance we can help! Give us a call today! Repairs don’t scare us and they shouldn’t scare you either!