Some properties are almost perfect – the location is good, and the property has potential, but significant improvements need to be made. Without those repairs, the home might not be suitable for living, and lenders might be unwilling to fund loans on a property with problems.
FHA 203K BENEFITS
FHA 203K makes it possible for you to turn that property into a home (and to get that property off the market and make it a valuable part of the community again).
- Fund repairs and purchase: you can borrow enough to make your purchase plus enough to make the necessary improvements. Because the Federal Housing Authority (FHA) is involved, lenders are willing to move forward with a property they otherwise wouldn’t touch.
- Temporary housing: unless you want to live in a construction zone, you’ll need funds for other housing arrangements. In certain cases, you can borrow extra to cover rent or your existing mortgage for up to six months.
- Project overview: your project must be completed within six months. Funds are placed in an escrow account and paid out to contractors including a 203K consultant as the work is completed.