So many Buyers today are eager to purchase homes at below market prices. Often these homes are in need of serious repairs or improvements to update the property. The 203k Program handily meets the needs of Buyers today.
This miracle program allows a Buyer to purchase a home and obtain the monies for repairs or home improvements all rolled into a single loan with a SINGLE monthly FIXED RATE payment. The repairs can cost as little as $5,000 or can run as high as necessary to fully gut-renovate a home.
The limit on the repair monies included in the loan is the Loan-To-Value (LTV) Limit based on statutory FHA Loan Limits in your area (see below). And this LTV percentage is calculated based on the value of the house AFTER improvements.
The 203k program even has a provision allowing the Buyer to request that up to 6 months worth of mortgage payments be included in the loan so they donâ€™t have to pay two monthly housing
expensesâ€”rent and mortgageâ€”while the house is under construction.
With more and more bank-owned â€œREOâ€ properties offered for sale, BuyersÂ need the 203k
Program more than ever before.
203k Interest rates run higher than market,Â but this is still an ideal program to help Buyers achieve their goals of homeownership while simultaneously updating or renovating a home for the lowest possible cost.
Highlights of the 203k Program:
Current FHA LOAN LIMITS for the New York Metropolitan Region:
* No Reserves on 1 and 2 Family homes (but it helps!)
* 3 Months Reserves required on 3 and 4 Family homes
* 3.5% Downpayment
* 6% Sellerâ€™s Concession
There you have a good fundamental look at the miracle program known as FHA 203k.