The Home Buyer's Korner

Information presented should be used for educational purposes only.

September 23rd, 2014

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Homes in Need of Repair

BeforeA distressed home, short sales or foreclosures that are in need of rehab work can be marketed to home buyers who are pre-approved for an FHA 203K Loan. Typically, properties in need of work are primarily sold to cash investors because most community banks know longer lend on a distressed home. However, in order to purchase properties in this condition a home buyer can use FHA 203K with repairs up to FHA county maximum loan amounts and even USDA’s micro renovation programs, which allows for repairs up to $10,000 for cosmetic repairs. 

Property Investors purchasing these homes with cash often are able to drive the price down below market value since they have to cash reserves and lines of credit to rehabilitate and get it ready for resale at a profit or turn into a rental unit. However, when a home buyer who actually plans on living in a home can purchase and complete the renovation work just as if it was purchased by a property flipper, but they effectively cut out the middle man and capture the profit through equity appreciation. That’s truly is a win/win for everyone, including the neighborhood at large and everyone on Main Street. 

AfterNot only does an FHA 203K and USDA Rural Development help preserve real estate values; construction industry workers are helped with employment opportunity, which jump starts our economy. 

Here’s just a few possible upgrades available with FHA 203K Loans:

  1. Repair or replacement of roofs, gutters and downspouts;
  2. Repair, replacement or upgrade of existing HVAC systems;
  3. Repair, replacement or upgrade of plumbing and electrical systems;
  4. Repair or replacement of flooring;
  5. Remodeling, such as kitchens and bathrooms;
  6. Painting, both exterior and interior;
  7. Weatherization, including storm windows and doors, insulation, and weather stripping;
  8. Purchase and installation of appliances (free-standing ranges, refrigerators, washer/dryer, etc.);
  9. Accessibility improvements for persons with disabilities;
  10. Lead-based paint stabilization or abatement of lead-based paint hazards;
  11. Repair, replacement or addition of exterior decks, patios, porches;
  12. Basement finishing and remodeling, which does not involve structural repairs;
  13. Basement waterproofing;
  14. Window and door replacements and exterior wall re-siding;
  15. Repair or replacement of septic system and/or well;
  16. Major rehabilitation or major remodeling, such as the relocation of a load-bearing wall;
  17. New construction (including room additions);
  18. Repair of structural damage;
  19. Repairs requiring detailed drawings or architectural exhibits;
  20. Landscaping or similar site amenity improvements;

The bottom line is that general contractors interested in participating in this great market need only become a Google+ community member of our network and complete the required lender certification requirement set by HUD to participate.

HOME OWNERSHIP TOOLS

FHA 203K

Your Home Purchasing or Refinancing & Renovation Tool

Mortgage Loan Officers, Real Estate Agents & General Contractors

are ready to assist you with your home purchase

FANNIE MAE HOMESTYLE

The Conventional Alternative to FHA 203K

Great for Real Estate Investors and Second Home Renovations

You Mortgage Loan Officer, Real Estate Agents & General Contractors

are ready to assist you with your home purchase

FANNIE MAE HOMEPATH RENOVATIONS

Rebuilding the Dream of Home Ownership

Fannie Mae HomePath has No Mortgage Insurance up to 95% LTV

Up to $35K for Home Improvements, Renovations or a Simple Remodel

Your Mortgage Loan Officer, Real Estate Agents & General Contractors

are ready to assist you with your home purchase

USDA RURAL DEVELOPMENT

Up to $10K for Home Improvements, Renovations or a Simple Remodel

Your Mortgage Loan Officer, Real Estate Agents & General Contractors

are ready to assist you with your home purchase

A SIMPLE HOME SHOPPING INSPECTION TOOL

Organizing your home shopping experience affords a wise decision making process.

This simple home inspection tool makes your ultimate buying decision a smart one.

To print this document click on “Open in New Window” located at the lower right corner; click on “File”; then click on “Print”.  In the center of the screen you will have the option to “Create A Printable PDF of the Presentation”.

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