Home Buying in Gardner>Question Details

Rick Kempf, Home Buyer in Essex, IL

need sugestions on a rehab loan availability

Asked by Rick Kempf, Essex, IL Sun Sep 14, 2008

I found a home for sale for 38k,(or best), it needs 20-25k in repairs ( its been gutted, owner was going to rehab mut was transfered to another state. floor panels, drywall and electrical need installed) Im a carpenter and this is all easy stuff for me to do. i need a loan for me and the wife. her credit is fair to ok and mine poor (divorce). who can help with this in illinois and what should i be asking them? acording to all payment calculators with escro id be paying less than i am renting for now. wife has job at hospital but my income is cash from ebay and I stay with the kids. am I screwed?

let me know

dakotaclassiccycle@hotmail.com

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3
A 203K loan seems appropriate but this is also credit driven and requires a credit score higher than the typical FHA loan. You must seek out a knowledgeable mortgage officer to assist you. In my area Wells Fargo has been very efficient and effective in securing these loans for my sellers. If you would like additional information please contact me, I would be most happy to direct you to a lender who can assist you.
0 votes Thank Flag Link Sat Dec 11, 2010
Hi Rick,

If you are going for a rehab loan, again, there is an FHA 203K loan out there but you need to put at least 3.5% down and then the repairs can be rolled into the mortgage as long as the home appraises for the value with the repair estimates. But the caveat with this (I believe since I'm not a mortgage broker) is that the repairs would need to be done by a licensed contractor - so you may fit that description or not, so that is something you would need to talk with the mortgage broker about as well if asking about this 203K loan. Also, your credit scores are going to be important with what type of interest rates you'll get for the loan if approved. Many banks are looking for at least 620 or higher, even better is 680 or higher. Start with maybe your local bank or credit union and see what they have to offer since you already have an account with them. Then start asking friends and family members for referrals since they have already worked with them or know them and can account for their services and professionalism. I wouldn't talk with more than 2 or 3 people so your credit report doesn't take a hit for the inquiries, but it's a good idea to get a few options and then choose one that best fits your needs. Good luck!
0 votes Thank Flag Link Tue Apr 21, 2009
Hi Rick,

I am not in Illinois, but I would talk to a mortgage broker or someone in your bank if they do mortgages. My state of Massachusetts has a MASS Housing program that still does 100% financing options with certain income levels and credit scores. There are FHA programs out there, like 203k where you can put some money down and roll the repairs into the mortgage amount. In this marketplace, unless you have some cash saved to put down on a house, it could be tough to get approved for a mortgage. But you won't know that until you talk with a local mortgage professional - and make sure it is local and not some company you find online with representatives that may not even be in your state. Good luck!
0 votes Thank Flag Link Mon Sep 15, 2008
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