What is a 203k?

Asked by Mildred Dawson, Philadelphia, PA Wed Aug 1, 2012

I saw this in one of the houses. It said prime candidate for a 203k and I wanted to know what that is. Thanks!

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Larry Lichtman’s answer
Larry Lichtm…, Agent, Bala Cynwyd, PA
Wed Aug 8, 2012
Hi Mildred,

Simply stated it is a mortgage program that allows you to bundle purchase and repairs/improvements/upgrades into one loan.

Please feel free to contact me directly with any other real estate related questions.

I'd be happy to meet with you and discuss helping you purchase your next home or investment property.

All the best,
Larry Lichtman, CNE
REALTOR, Property Manager
Your Real Estate Resource For Life
Cell/Text: (267) 254-7994

Real Estate Sales, Management & Insurance
1611 Snyder Avenue
Philadelphia, PA 19145
Office: (215) 271-7070
1 vote
Hannah Angert, Agent, PHILADELPHIA, PA
Wed Aug 1, 2012
If you seek to live in the home immediately, this is probably not the kind of home or loan that you want to take. 203k homes generally require a great deal of renovation or modernization. If you're looking for a "project home", the 203k is a great option to explore. Word to the wise - use a 203k experienced loan officer and 203k experienced contractors! These folks are crucial to making the process move along.

Hannah Angert
0 votes
Danielle Gur…, Agent, Philadelphia, PA
Wed Aug 1, 2012
A 203k loan is a home loan through fha - a government insured loan. This kind of loan is perfect for those who want to buy a home that they can do modifications to with a low interest rate and low down payment. With a 203k loan you are approved for a certain amount so if you are approved for $150 and you put it an offer for a home at $120 then you can take the difference to do your repairs; and like a regular fha loan you put down 3.5% and interest rates are about 3.5% right now! If you are interested please let me know, I work with a mortgage loan officer who can prequalify you in minutes. In the mean time feel free to browse my website for some available homes!

Danielle R Gurst
Remax Affiliates NE
267 423 2623
fax 215 525 2852
0 votes
Alan Openshaw, Mortgage Broker Or Lender, Southampton, PA
Wed Aug 1, 2012
Hello Mildred,

A 203k is a type of loan that you use to buy a house and fix it up. Usually the property is in disrepair and the lender will not finance a house that is not safe sound and secure. The 203k loan allows you to finance the purchase and also the fixup costs with a minimun down payment (3.5%).

You can finance anything kind of improvements except, additions,and the building of swimming pools. For example you can do paint, plumbing, electrical, siding, appliances, carpet, cabinets, roof etc etc

For more information go to my website and click on the link at the botttom.

Alan Openshaw
Cornerstone Lending Inc
Southampton Pa 18966
215 953 0800
cell 267 992 7276
NMLS ID 143960
0 votes
Sarah Bridges, , Philadelphia, PA
Wed Aug 1, 2012
It means that the home likely needs repairs in order to be financed. A "203k" refers to an FHA 203k type of loan in which the cost of repairs needed can be added to the total loan amount in order for repairs to be completed after closing. There is much more to an FHA 203k than I could fit in a short answer to your question, so please feel free to talk to me about it.

Sarah Bridges

RE/MAX Prime Real Estate
Office: 610.622.7500 Ext 115
Direct: 215.558.0628
0 votes
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