Today's topic - the 203 (k) - HUD's tool to help revitalize and rejuvenate provides a great opportunity for those people who have the ability, but not necessarily the funding. I've recently been property shopping inside the beltline - and have found plenty of great bungalows that would be perfect for me. Upon closure inspection, even though these homes are in my price range, they need some serious repair to make them a comfortable and inhabitable home. All over the nation there's streets of great homes, in convenient areas of town, that need some renovation before they can become homes again. That's where this 31 year old program comes into play. The basic idea is to provide funding for both the purchase and the renovation of a home. The loan is a FHA product, so any purchase will require a 3.5% down payment. The repairs can be simple cosmetic improvements like new kitchen appliances or floor covering replacements, or serious items like plumbing or HVAC. There's a minimum of $5k worth of required improvements but additional costs like work permits, inspections, etc can be financed into this amount. The max amount you can finance for repairs is around $30k, which goes a long way when you're looking to replace and repair the roof, windows, etc. If you can't live in the property while the renovations are taking place, some lenders will allow up to 6 months of payments to be financed in.
This program is quite popular with non-profit organizations- providing low cost housing with repair and rehab provisions paints a perfect option for transitional housing needs. One (1) to four (4) unit residences are eligible but FHA loan limits still apply. The 203(k) program is not available through all lenders, so considering, check your area for availability.
Today's market notes: rates were down a bit, par showing at 4.875-5.00% (avg. of our lender's rates & may not reflect national averages).
DNJ Mortgage
1350 Sunday Drive
Raleigh, NC 27607
919-459-6533
919-459-6533
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