Saturday, July 23, 2011

Fixer Upper Financing? How To Finance A Distressed Property Or Foreclosure


Location, location, location...words many of us have heard from our parents growing up. This could not be more true when purchasing a new home. Location and potential in the home you are buying are very important. We have found that many home buyers today are finding a great location, but the house itself needs a little work.

With an increase of Foreclosures and or Short Sale or Bank Owned homes on the market today, buyers are finding that the seller's or sometimes the bank who owns the home is not in a position or refuses to make necessary repairs for traditional financing. Let's say you have your down payment saved, or have received a gifted down payment and you begin to shop for a home. You narrow it down and make an offer which is accepted right away! Your Realtor calls your Mortgage Consultant to make sure that the property in it's current condition (you are getting a good deal and know you can fix it up yourself later) come to find out there is no way that you can close with traditional financing on the home in it's current state. This can be the case when a buyer is approved for FHA, VA, USDA or Conventional financing. Do you need to walk away and find something that might not be in the right location, on the right lot, or in the right school district? No, enter the FHA 203k Streamline option.

Did you know that with an FHA 203k Streamline loan you can finance the items (check for qualifying repairs) to turn your fixer into your beautiful new home with one loan, one closing, and no second mortgage?

Here are the general criteria for qualify:

May be used to purchase or refinance (1-4 unit single family)
Can be used to update a home, correct health and safety issues

Rehabilitate up to $35,000 items can include:
o Repair/replacement of roofs, gutters & downspouts
o Repair/replacement/upgrade of existing heating, ventilation & air conditioning
o Repair/replacement of plumbing & electrical systems
o Repair/replacement of flooring
o Minor remodeling that does not involve structural repairs
o Weatherization, including storm windows & doors, insulation and weather stripping
o Purchase & installation of appliances, including free-standing.
o Improvements for accessibility for persons with disabilities.
o Lead-based paint stabilization or abatement of lead-based paint hazards
o Repair/replacement/addition of exterior decks, patios & porches.
o Basement finishing & remodeling that does not involve structural repairs
o Basement waterproofing
o Replacement of windows, doors, and exterior wall re-siding.
o Well/septic repair
o Pool repair for health and safety only, such as an empty pool on a foreclosure sale.

A few questions you may have:

Can this program be used when making an offer on a Foreclosure or Bank Owned home?
Yes! This is ideal for a home in need of repairs that the seller or bank will not make.

Does this program allow me to buy a "HUD" home and finance my repairs?
Yes, it does. Talk to your Mortgage Consultant for more information.

Can I use this program with a refinance if I already own the home and it needs repairs?
Yes you can, as long as you are not taking any cash out and financing the rehab costs up to $35,000

How do I get started?

Contact your Mortgage Consultant today for more information on how to qualify for this loan and a referral to a FHA 203k Expert Realtor.

Article Source: http://EzineArticles.com/6145951

Want more info on how you can get a 203k loan? Call Mike Young, the 203k expert!
1.707.812.7668