What are alternatives to FHA 203k program - Can you buy with FHA, then get a heloc?

Asked by Devoncox, Denver, CO Thu Nov 5, 2009

I wanted to do a 203k streamline but have read horror stories on the internet and even lenders who offer it says no one has had good experiences with it. What are alternatives? My goal is to buy the house and then put ~$30k of work in to it.

Can I buy using FHA, then immediately get a HELOC for any equity I have in the house and use that?

Other options?

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Answers

6
Ray Williams, , Denver, CO
Thu Mar 4, 2010
Hello,

I came across your post on the 203K question. I do see it was from a handful of months back. But did want to let you know that the FHA 203K loan is not something to be timid of. It is quite easy to accomplish when working with a qualified lender. The thing I find most helpful is having construction knowledge of home improvements. From there the process is also involving contractors, so they beomce an important asset of your 203K mortgage process. This is where I see the disconnect. If you don't have your ducks in a row it can be tough, but my office does them on a regular basis and usually without a hitch. If you are still curious about the 203K let me know and we can chat further.

Ray Williams
Branch Manager
Summit Mortgage
Denver
303.779.0591 x101
0 votes
., , Sioux City, IA
Wed Jan 13, 2010
Great question. If you are looking to make improvements, especially with a 203k, do not believe the horror stories! I am an EcoBroker®, a certified green real estate agent, and I focus on homes and properties that are in dire need of rehabilitation, and specifically green or energy efficient renovations. My experience is that yes, most lenders and agents tell horror stories because they have no clue what they are doing - especially in terms of being green. What you need is an EcoBroker and a Mortgage Broker who understand the importance of rehabilitating and restoring value to homes, and who make these types of transactions their main focus.

It is all in the mind - if people think it is difficult to do a 203k, it will be a nightmare. Likewise, if you work with an EcoBroker such as myself, the process is actually quite exciting and inspiring. From walking through an energy audit, to selecting the most cost effective improvements to make, to watching the contractors install green upgrades. From moving in and living a more comfortable healthy economically and environmentally friendly lifestyle, to receiving local, state, and federal tax credits or deductions and rebates - being green in real estate is the best way to go.

Indeed, there are a few more requirements than a normal loan - the energy audit, and having all bids for work into the lender before closing, etc - however as I mentioned, there are people who are just dying to help a eco-conscious buyer to use an FHA 203k loan, or any other type of financing, to make the home efficient and sustainable.

Feel free to contact me by phone, text, email, or through Trulia for more information on making the renovation process efficient and simple! Good luck!


Sincerely,

Andrew Cepeda
Realtor® and EcoBroker®
Metro Premiere Properties
26 W Dry Creek Cir Ste 200
Littleton, CO 80120
http://www.greenknightofrealestate.com
Cell: 720.216.7617
Fax: 303.794.0039
Email: andrew@greenknightofrealestate.com
0 votes
Debbie Shelt…, Agent, Flagstaff, AZ
Wed Nov 11, 2009
My experience has been positive although I have heard from many that haven't. I think that the best possible
thing you can do for yourself right now is to educate yourself on the program as much as possible. I have supplied a link below to the page which details all the steps, requirements and options to consider when using FHA 203K. Scroll down to the "Introduction" to begin and definitely request the HUD handbook which references this topic specifically.

Good Luck to you,

D Shelton ABR REALTOR
0 votes
Brian Burke, Agent, Highlands Ranch, CO
Thu Nov 5, 2009
It is really hard to get the 2nd you are looking for. Are you sure there are the comps in the are to support a 2nd?
I would consult a good lender that does FHA loans often. Then get a second opinion. You also can not count on moving in and getting the 2nd loan later. The lending guidelines may change in the future and then you may not get the 2nd you were looking for.
Brian
0 votes
Tim Klein, Agent, Littleton, CO
Thu Nov 5, 2009
Devoncox:
I've had better success with 203k's than the previous answer. Am doing one right now using Jim Duvall at Wells Fargo. Jim's number is 303.840.6051. He could best answer the HELOC question. Good luck!

Tim Klein
Broker
Metro Brokers - The Realty Werks
303.973.7600
0 votes
John Keene, Agent, Denver, CO
Thu Nov 5, 2009
Devon,

I have yet to work with a buyer that was successful in purchasing a home with a 203K loan. I would suggest you speak with Mike Savell at Chase Bank. He is my go-to lender and can help to educate you on your financing options.

Contact Mike at 303-625-3123 or michael.b.savell@chase.com

Best of luck,

John Keene
Keller Williams
303-547-7578
0 votes
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