What is a 203k mortgage?

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I would buy a house is priced at $ 150,000. I made an offer that the exact amount. Nobody else has even put a bid if the bid is “very similar”. Listing agent said he would offer me when I was a 203k loan the same amount. With this type of mortgage, and why would it be better? Thank you all!
Can anyone direct me to the list of eligible repairs to cover 203k FHA mortgage. We want, but the fixer upper, but you should know what repairs are covered. Thank you live in Oswego County, NY, and I want to buy if it is different.

4 Comments
  1. Reply
    Tom K
    January 23, 2011 at 4:03 am

    Don’t know why it would help, but here is what it is

    A 203K streamline loan is a loan provided to the purchaser of a home to do some renovations and or improvements to a home they are purchasing with cost ranging from $ 5,000 to $ 35,000. That is why it is called a 203K streamlined loan. A FHA 203K loan is for a total rehabilitation of a home that is in need of major repairs and renovations and is not in livable conditions. Some purchasers get these two types of loans confused.

    There is a myth going on around the 203k Streamline loan that a consultant may not be needed. That is true up to $ 15,000, if the work comes to more than $ 15,000 a consultant will be brought in to complete a ‘plan review’ and insure that other required items are added to the work write up.

  2. Reply
    Landlord
    January 23, 2011 at 5:02 am

    Think twice.

    The only reason this would possibly help is because the bank will not care if the house is habitual or not.

    It sounds like the agent may know that a conventional loan will not close because something is wrong with the property.

    These loans are expensive and require you to refi quickly, adding to your costs.

  3. Reply
    Terry Socia
    January 23, 2011 at 5:10 am

    All the repairs necessary to get it into livable condition if the repairs don’t drive the price up to over 96.5% of it’s value and sometimes it is 80% of it’s value. Check with the lender on this percentage

  4. Reply
    Lisa S
    January 23, 2011 at 5:56 am

    Usually a 203K loan covers all repairs except; moving a wall, major structural damage, putting in a pool (it will however pay to get an existing pool in working condition). I closed one in June and the buyer’s had new plumbing run, electrical issues fixed, a new roof (on the home and detached garage), new flooring, kitchen counters and appliances, rehabbed both bathrooms (down to the studs), took out 2 trees that were too close to the house (covers some landscaping), repaired the rear fence line (a tree had fallen on it), repaired some drywall, replaced some drywall.

    Eligible Improvements

    Luxury items and improvements are not eligible as a cost rehabilitation. However, the homeowner can use the 203(k) program to finance such items as painting, room additions, decks and other items even if the home does not need any other improvements. All health, safety and energy conservation items must be addressed prior to completing general home improvements.

    http://www.disasterhousing.gov/offices/hsg/sfh/203k/203kabou.cfm

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