Wednesday, April 27, 2011

Which Properties Are Eligible For The 203K?

1. Any one to four unit properties which have been completed (with a certificate of occupancy) for at least one year are acceptable according to the provisions of local zoning requirements.

2. Homes that have been demolished or razed as a part of the rehabilitation process can be rehabbed as long as the existing foundation system is not affected and remains in tact. (as long as there is a portion of the original foundation)

3. A home can be moved onto a foundation on the mortgaged property, provided the proceeds from the sale of the previous location are not released until the foundation is properly inspected and the home is satisfactorily attached to the new foundation.

4. Any property the buyer wishes to convert either from single family into a two-four family property (if zoning will allow the change) or from a two to four family dwelling into a single family unit. Let’s take this one a little farther - You can take a 5-8 plex and turn it into a 1-4 unit. i.e..... Make an 8 plex into a fourplex and use this program.

5. A manufactured home that was built AFTER June 15, 1976, and has been on a permanent foundation for over one year is eligible, provided the unit must have been delivered to the site when it was new, prior to being occupied.

6. A 203k can be used on a "mixed use residential property” provided it meets the following requirements:

The floor space used for commercial purposes does not exceed...

25% for a one story building

33% for a three story building

49% for a two-story building

The commercial use must not affect the health and safety of the residential occupants.
The rehabilitation funds will only be used for the residential functions of the dwelling and areas used to access the residential part of the property.

7. Condominiums are eligible with the same restrictions as an FHA loan.