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Financing in Fayetteville : Real Estate Advice

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  • Local Info10
  • Home Buying26
  • Home Selling5
  • Market Conditions5

Activity 3
Thu Oct 2, 2014
Hi Dionne,

Thank you for your service.

As has already been pointed out, VA does not have a renovation or rehab product but it maybe possible to do a repair escrow depending on the "type" of work needed.

I'm sorry but I have to disagree with Brent. It will almost never make sense to buy using one loan program and then turn around and refinance it into another loan program and here's why.

I'm going to use $250,000 as your loan amount for this example: If you used an FHA 203K loan to buy and renovate your home you're going to add $281.25 to your monthly payment due to FHA's monthly mortgage insurance (MMI) plus the upfront MIP of 1.75% or $4,375.00. Most lenders will require that you've made at least 6 payments before refinancing so you'll spend an extra $1,687.50 in MMI plus the FHA MIP of $4,375 for a total of $6,062.50 PLUS closing costs for the new loan which could run anywhere from $3,000 to $6,000 depending on your escrows and the lender. That put's your "cost" at $9,000 to $12,000 which makes it cost prohibitive in my opinion. The second aspect to this is will you have enough equity once everything is done to actually refinance.

Take a look at the recommendations from some of my past clients on my Trulia profile by clicking the link below my phone number.

Please feel free to contact me for more information or help.

John Burke
Senior Mortgage Banker
Lending in ALL 50 states
Great Plains National Bank
NMLS# 787231
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Thu Feb 18, 2010
Hi RJ,

My answer is correct regarding PMI on a 90% loan-to-value 2nd home. However, after further verification, I have confirmed a 720 fico is now required. It is possible that Lew (and Carl) do not have access to this program through the PMI vendor relationships they have.

Please let me know if I can help further.

Thank you,
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