Searching diligently for a home? Have you passed over your dream property due to cosmetic problems because it won't pass with the FHA for financing? Well, look no further. FHA has came up with something to help you out. I introduce the 203K Streamline Loan, which was created in part due to the fact that many lenders won't do rehab loans anymore, and is much much simpler than the notorious 203K Loan (evidently theStreamline part is what makes the difference, haha).
This loan, in essence, allows a potential homeowner to finance up to $35,000 of needed home repairs into the purchase or refinance of a property. This is excellent compared to a traditional rehabilitation loan, because it doesn't include the same review requirements, and consequently involves much less paperwork. Here are some of the other benefits of the 203K-Streamline:
- Needed repairs are figured into the original loan balance, resulting in one loan.
- The mortgage balance can exceed the purchase price of the house.
- Borrowers are not required to hire engineers, consultants or architects.
- The home inspector or appraiser can put together a list of recommended repairs/improvements.
The program is designed to assist homeowners in easily rehabilitating a home where building consultants, engineers or architects are not required. This is a big difference compared to the regular 203K.
So you may be asking, what all repairs can be financed? Well, eligible improvements include roofs, HVAC systems, plumbing or electrical upgrades, flooring, minor kitchen or bathroom remodeling (not involving structural repairs), weatherization, replacing old appliances, lead-base paint stabilization, repairing or replacing exterior decks, patios and porches, basement finishing or remodeling (again with no major structural changes), replacing windows and doors, septic system repair or replacement, painting and minor cosmetic changes.
Overall, the 203k Streamline Loan is a fantastic way to purchase a home that otherwise would not pass for an FHA appraisal. Due to all the foreclosures lately, it truly could become the loan of the future.