2009-11-15 15:29:23 203 K Streamline Loans are The Best FHA Loan
203 K loans are the FHA loans that allow you to buy a home that is a fixer upper. The newly developed FHA 203 K Streamlined loan allows you to buy a home that is run down that wouldn't qualify for FHA financing. As loan as there is no structural repairs needed. The list of allowable repairs is below. Buying with the FHA 203 K Streamlined loan is easy all you need to obtain contractors bids and submit them to your lender. This can be done at the time of inspection or maybe week of the inspection. Sure it more work but the get a home at a great buy and the money to fix it up at only 3.5% down payment, you'll have to do a little more. It a great loan because it gives the buyer the ability to buy a Short sales, bank owned or just undervalued property that the seller won't do FHA repair and have the home the way you want after closing with little of your buyers money . They can get up to $35,000 in repair, winterizing, greening up the home, put in new windows and R50 insulation in the attack, upgrade the electrical, making it just the way your client wants, and they just have to pay the 3.5% down on that portion and the rest in put in the loan. You can do allowable repairs up to $35,000 with no minimum; so if you just need $3,000 for carpet you can burrow that above the purchase price. If you need a new furnace and upgrade to the electrical system that's Ok you just need to get bids form licensed contractor that meet requirement to do the work. Can you do the work yourself? Yes and no; you can do the work if you have the expertise and can prove it or if it is unskilled work like painting.
What improvements are eligible under the new Streamlined (k) program?
The Streamlined (k) program is intended to facilitate uncomplicated rehabilitation and/or improvements to a home for which plans, consultants, engineers and/or architects are not required. The Streamlined (k) program includes the discretionary improvements and/or repairs shown below:
Repair/Replacement of roofs, gutters and downspouts
Repair/Replacement/upgrade of existing HVAC systems
Repair/Replacement/upgrade of plumbing and electrical systems
Repair/Replacement of flooring
Minor remodeling, such as kitchens, which does not involve structural repairs
Painting, both exterior and interior
Weatherization, including storm windows and doors, insulation, weather stripping, etc.
Purchase and installation of appliances, including free-standing ranges, refrigerators, washers/dryers, dishwashers and microwave ovens
Accessibility improvements for persons with disabilities
Lead-based paint stabilization or abatement of lead-based paint hazards
Basement finishing and remodeling, which does not involve structural repairs
Basement waterproofing
Window and door replacements and exterior wall re-siding
Septic system and/or well repair or replacement
How do you get the extra money?
As the buyer you get contractor bid and with your loan officer calculated the cost into a 203 k Loan Worksheet. Your money will be released form title after the work is completed. Inspections are at the discretion of the lender. There are options to get ½ the cost up front if the contractor needs that for cost of materials but no more than 2 payments the initial and final after completion. This is loan is not for building a home or completing substantial work it a fixer up or and updating a home loan. It a great tool in today market to by Short sales and bank owned homes that need TLA and won't qualify for the traditional FHA loan.
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203 K loans are the FHA loans that allow you to buy a home that is a fixer upper. The newly developed FHA 203 K Streamlined loan allows you to buy a home that is run down that wouldn't qualify for FHA financing. As loan as there is no structural repairs needed. The list of allowable repairs is below. Buying with the FHA 203 K Streamlined loan is easy all you need to obtain contractors bids and submit them to your lender. This can be done at the time of inspection or maybe week of the inspection. Sure it more work but the get a home at a great buy and the money to fix it up at only 3.5% down payment, you'll have to do a little more. It a great loan because it gives the buyer the ability to buy a Short sales, bank owned or just undervalued property that the seller won't do FHA repair and have the home the way you want after closing with little of your buyers money . They can get up to $35,000 in repair, winterizing, greening up the home, put in new windows and R50 insulation in the attack, upgrade the electrical, making it just the way your client wants, and they just have to pay the 3.5% down on that portion and the rest in put in the loan. You can do allowable repairs up to $35,000 with no minimum; so if you just need $3,000 for carpet you can burrow that above the purchase price. If you need a new furnace and upgrade to the electrical system that's Ok you just need to get bids form licensed contractor that meet requirement to do the work. Can you do the work yourself? Yes and no; you can do the work if you have the expertise and can prove it or if it is unskilled work like painting. 
How do you get the extra money?