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Your question does not have to be FHA 203K related, it can be general FHA or Conventional questions as well. One of our 203K Specialists will answer your question the best to their ability.
We look forward to hearing from you!
“Your FHA 203K Mortgage Lender”
What do you think of when April 1st comes around?
Pranks would be the guess for most people but for the Federal Housing Administration (FHA) it’s time to increase the amount of their mortgage insurance premium which will affect all forward mortgages and that is no fooling.
What is changing?
An increase to the annual mortgage insurance which is paid monthly on FHA loans.
Why is it needed?
FHA insurance is needed to cover losses in case a loan defaults. In return FHA approved lenders can qualify your loan with more flexible guidelines.
When does it go into effect?
April 1st 2013
How much more is the increase?
The range will be from “.05 to .10“ basis points (BP) depending on the Loan size (under or above $625,500), Loan term (15 or 30 yrs) and Loan to Value (LTV – Down payment/Equity amount)
These changes in return are supposed to help keep the FHA programs going strong for now and into the future for all homebuyers and homeowner.
If you are now or will be using FHA financing including the 203k renovation loan and are interested in how this could affect you then contact your FHA Loan Officer/Lender for more details.
Next FHA mortgage insurance premium change on the horizon – June 3rd. 2013. More on that later so sign up for the free guide/ resources over at the 203K Mortgage Lender website.
If you’ve ever tuned into the HGTV show Property Brothers featuring twins Jonathan and Drew Scott, you will have seen some amazing transformations take place. Jonathon and Drew help people to locate, buy and transform dilapidated properties or extreme ‘fixer-uppers’ into their dream homes.
There will always be a certain percentage of people who want their homes to be ideal when they move into them, but this isn’t always possible because a home which is already perfect tends to be expensive. Properties which need lots of attention tend to be far more affordable and always have potential for a profit when sold in the future. The key is to keep an open mind and not be daunted by the prospect of major upheaval and potential hard work.
‘Property Brother’s’ uses cutting edge computer generated ‘CGI’ technical effects to show buyers exactly how their home could look once all the necessary work has been carried out. Unfortunately, we can’t all create a CGI image but we all have an imagination which we could use in helping us decide whether a fixer-upper is a good investment.
Financing a Renovation
In order to take on an ambitious project like a major renovation you need to sit down and work out exactly how much the work is going to cost. Make sure that you obtain as many quotes as possible for the whole project or for each separate job so that you can budget more accurately. Many U.S homeowners end up spending more on a renovation than they had originally calculated, so it may be prudent to borrow a little more money as a back up plan if possible.
Loans from banks and other financial organizations can be difficult to get. Especially separate funds for remodeling or construction such as a second mortgage or Home Equity Line of Credit.
On mortgages that will be in first position lenders can require a large down payment and so this may leave you short of cash to carry out the work that needs doing.
… continue reading Property Brother’s – How to Turn Your Property Dreams into Reality
Trying to decide whether to buy a New or Old home?
Here are some things to consider
If you’re one of the many people across the country looking to buy a house at the moment, you’re on the verge of making one of the most important financial decisions of your life. You have two choices when it comes to buying a house. You can either buy an older pre-owned house, or you can go for something new. This article will look at buying an old house vs. a new house and hopefully give you some things to think about when making your decision.
… continue reading Buying an old House vs. A New House
As a soon to be or current homeowner, mold in a property is something you might come across or have concerns about and for good reason. Other than mold creating an unpleasant visual sight in your home, which frequently is around windowsills and doorframes, it also can be less visible in areas such as the basement, behind washers, dryers and dishwashers. Mold can eat away at your home’s finishes and can also ruin furniture. As well as give off an unpleasant, musky smell. Most importantly mold can have potentially serious health effects and can increase the risk of respiratory illnesses. So, depending on the type of mold it can be highly toxic.
Did you know the area you live in could increase your odds of getting mold?
Locations along the Pacific and Atlantic Oceans are known for high levels of rainfall and humidity which are prime locations for moldy houses. Properties near large freshwater bodies of water are also susceptible to the growth of mold. If you’re thinking of buying or own a home in these regions then keep that in mind.
Take a look at the areas where moisture is most likely to accumulate.
This includes bathrooms, kitchens, laundry rooms and of course basements. Look underneath the sinks as well as behind appliances such as your washing machine and dishwasher. Any leaks, cracks or poor ventilation should be addressed to avoid any mold growth. Proper air circulation is key in limiting the humidity of the air in your home. By reducing the humidity this will deny mold the chance to obtain the stale amounts of oxygen it needs to thrive. The use of dehumidifiers and air conditioning are good methods to employ against mold accumulation.
Remedies for removing mold can vary from doing it yourself to having a professional handle it. For those of you buying a property the FHA 203k loan can help with any preventative or mold removal projects as it can be financed into your loan. Regardless of the size that needs treatment or budget, the 203k loan can be used to take care of it and best of all it gets handled after the transaction closes so there are no financing hold ups. This also applies for homeowners, no need to remove it beforehand; you can do it after you close your refinance.
So, when you come across mold in your property and need to take steps to remove it or make home improvements to prevent it, the 203k loan can help with the financing to get your property mold free.
Does your home need new appliances? Whether you are purchasing or refinancing your property with an FHA 203k loan don’t forget that brand new appliances can be included along with other improvements. Refrigerators, ovens, stoves, dishwashers and more whether free standing or built in, stainless steal or not your choice, your style.
If that sounds appealing then consider taking it a step further by using that opportunity to buy EPA recommended ENERGY STAR appliances and save yourself a bundle in energy costs.
Plus you can even get money back in a form of a rebate at times for purchasing an energy efficient appliance. With saving incentives both long term as well as possibly upfront what more can you ask for.
So, green up your appliances that will look and feel great in your home and will also save you money.
With FHA Loan Limits changing from time to time, many of you may be wondering what the limits are currently. We at 203k Mortgage Lender have you covered as we have two ways to check the latest loan limits:
1) From the HUD website where you can find the current loan limits by entering the County
2) Using the FHA Loan Limits widget by entering the zip code of the property location.
Each source will provide you with the most current and accurate information for FHA Loans as well as the FHA 203k Loan.
To view current FHA Loan Limits by county at the HUD Website click the following link:
or to view loan limits by zip code just enter the property zip code in the widget tool below.
FHA 203k Construction Loans…well not exactly.
Some might think that a 203k loan is a construction loan but actually it isn’t. Although a 203k can be used for remodeling, renovations and repairs there is a difference between this FHA loan and a construction loan.
The main difference is that construction loans can be used to build a brand new property from the ground up on raw land. 203k loans on the other hand are only for properties that are at least one year old and that already have an existing foundation. Along with that there are loan limits that apply to FHA loans which vary depending on your area.
Once you remove those two major differences, then the 203k does have similarities to a construction loan as far as the type of work that can be done to the property as well as how contractors get paid as the work gets completed.
The 203k may have some similarities, but unlike a construction loan, the 203k offers the following features that a construction loan doesn’t.
- Can be used to purchase or refinance an existing property and includes the funds needed for improvements combined
- Has a low down payment for purchases
- Has minimal equity requirements for refinances.
- Has the same current attractive interest rates like other first mortgages
- Is an all in one loan with terms up to 30 years.
If only they could come up with one loan to buy/refinance, include the improvements and pay off debts! Now that would be something. But, in the meantime 2 out of 3 aren’t bad with the 203k loan.
Have you ever driven past a home with a sign that says “Fannie Mae Homepath”? If so, and if you’re in the market to buy a home then this could be another option for you to add to your property search. So, what is a Homepath property? It’s a property which is currently owned by Fannie Mae and was acquired through the foreclosure process. The name “HomePath” is the branding term used for these Fannie Mae-owned properties.
There is no special requirement for you the buyer as HomePath properties can be purchased like any other property on the market with or without financing. It can be purchased as an owner occupied (your primary residence), an investment property or even as a second home. Fannie Mae also offers its own financing product specifically for these properties called a “HomePath Mortgage”.
Just like HUD homes, Homepath properties can have an advantage of being financed with the same type of home loan originally used before it was foreclosed on. On HUD homes that would be FHA insured financing. For Homepath properties that would be a “Homepath Mortgage”. There are two types to choose from, one with renovations and one without. Depending on the property it will indicate which type of Homepath financing is available which you can find at the HomePath website.
… continue reading Homepath Renovation Mortgage Financing and the FHA 203k Loan
HUD Homes and the FHA 203k Loan
What is a HUD Home?
Are you interested or wondered what HUD homes are and how to finance them? Well, just like properties which are purchased with conventional loans, properties purchased with FHA insured financing also at times go into foreclosure. When that happens those properties are then acquired by the Housing and Urban development (HUD). HUD becomes the owner of these properties that were financed with an insured FHA loan and then offers them for sale to recover the loss on the foreclosure. That is what a HUD home is.
How can I buy a HUD Home?
A HUD home can be a 1-to-4 unit residential property, condo, townhome or PUD and yes you can buy one. Actually anyone can buy one if you have the cash or can qualify for a loan. HUD sells these properties through a bidding process so you will need a Real Estate Broker that can sell HUD homes to submit the bid for you. The bidding time frame and who is allowed to bid on the property depends on what listing period it’s in. The two most common listing periods you will see when searching for HUD properties will be “exclusive” and “extended” listing periods.
The exclusive listing period is primarily to give owner occupant bidders a head start before the property goes into the extended listing period phase. When the exclusive listing period ends then all buyers are welcome to bid, owner and non-owner, so investors are welcome during the extended listing period.
… continue reading Hud Homes
Foundation Repairs and the 203k Loan
For many home-buyers foundation repairs can be a deal breaker. You would probably say, “If it wasn’t for those foundation problems I might have really considered that property”. Well before scratching the property off your list you might want to do some further investigations on how bad it is and what the foundation repair cost will be because luckily, the FHA 203k loan can handle it.
Many Home-buyers, Homeowners, Real Estate Agents and even Lenders might not be aware that the FHA 203k is even an option and could possibly save the deal. A few months ago on a Real Estate blog I read about a Real Estate agent who had a transaction involving foundation issues. It was discovered during the home inspection that the house was leaning forward. That then led to a foundation inspection. The deal was not looking promising, until the agent thought of the 203k loan as an option. If the sellers would agree to lower the price to offset the cost of the foundation repair then the deal could be saved. After figuring out a solution she mentioned it to her lender. The Lender, who worked with the Agent told her, “The 203k doesn’t allow foundation repairs”.
… continue reading Foundation Repairs