Buyer Loves the Neighborhood, But the House needs work! We have heard that a few times. There are so many homes on the market, but not all of them work for every buyer. Many sellers cannot afford to make the changes, updates, or repairs. But, some of these homes for sale could work with a few changes. New carpet, paint, tile, or hardwoods? Maybe, the home needs a lot more such as a total Kitchen or Master Bath renovation? But, the buyer does not have enough money to pay for the changes, closing costs, and down payment out of pocket. This is where the FHA Mortgage comes in!
There are two types of 203 K mortgages-the Standard and the Streamline. Here are a few of the differences.
All of the work has to be completed within 6 months of closing, but the buyer funds the work through their 203K mortgage. Loan limits depend on your area, but can run as high as $729,750 (Charlotte, NC is $303,750). There are energy efficient changes that will allow the loan limits to be higher for their value, too. The appraisal is completed with the value of the home after renovations. Owners must use the home as a primary residence for one year. Those are just a few of the requirements and options.
This would certainly help remove some of the more challenging listings off the market. For those buyers that find the home in the right location, but just need another bathroom or to expand the Master Bedroom; this could be the answer. As a real estate agent I am aware of many of the features of the 203K Mortgage, but to share all of them could turn this into a very long blog! Your mortgage representative will be the true expert for the details of this loan. It can be a complicated process, but for some buyers AND some sellers it could be very worthwhile.
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