Advantages of the FHA 203K Renovation Loan
The FHA 203k Renovation Loan allows a borrower to roll repair/renovation costs into their FHA loan. The repairs/renovation can include optional renovations/upgrades such as: interior and/or exterior paint, new flooring, kitchen/bath remodel, Stone Wall Cladding Energy Efficient Improvements, landscaping, etc. The process in obtaining and utilizing an FHA 203k loan can be very simple when working with the right loan officer who understands the program, and offers advantages to everyone involved in the transaction.
Advantages to Borrower
- Repair/renovation costs are rolled into the loan
- Both major and minor items are allowed
- Only 3.5% down on any FHA loan with up to 6% closing cost credit from seller allowed
- Loan amount can go up to 110% of the “after-improved value” on the appraisal
- Optional renovations/upgrades are allowed
- Customer can use a 203k consultant to help deal with contractors
- Interest on the entire loan may be tax deductable.
- Allows buyer to purchase homes that may not qualify under standard FHA guidelines
Advantages to the Seller
- Allows the home to sell to more buyers if it wouldn’t qualify for a standard FHA loan
- Repairs being rolled into the loan and not requiring seller to make repairs out of pocket prior to close.
- Not having to go off and on the market due to not passing an FHA appraisal
Advantages to the Contractor
- Up to 30% available up front to purchase permits and materials
- Not having to worry about getting paid once the job is done.
Should you have any questions or need further information,
please don’t hesitate to contact me, (775) 220-1630
Or visit my website: www.SellingHomesinReno.com
Joshua Talayka
NAR designated: Short Sale & Foreclosure Resource
Chase International
Office: 775 850 5900
Toll Free: 877 922 5900
Cell: 775 220 1630
Fax: 775 850 5901
985 Damonte Ranch Pkwy, Ste. 110
Reno, Nevada (NV) 89521
About The Author
Hey, you used to write wonderful posts, but the last few posts have been kinda boring… I miss your tremendous articles. Past few posts are just a little bit out of track!
Hi Marlen,
Thank you for your honesty. I am always looking to improve my blog and writing. Can you please elaborate on where I could use improvement? Such as is there a specific topic you are interested in seeing on my blog?
A standard or conforming mortgage is a key concept as it often defines whether or not the mortgage can be easily sold or securitized, or, if non-standard, may affect the price at which it may be sold. In the United States, a conforming mortgage is one which meets the established rules and procedures of the two major government-sponsored entities in the housing finance market (including some legal requirements). In contrast, lenders who decide to make nonconforming loans are exercising a higher risk tolerance and do so knowing that they face more challenge in reselling the loan. Many countries have similar concepts or agencies that define what are “standard” mortgages. Regulated lenders (such as banks) may be subject to limits or higher risk weightings for non-standard mortgages. For example, banks and mortgage brokerages in Canada face restrictions on lending more than 80% of the property value; beyond this level, mortgage insurance is generally required