Is a 203[k] anything like a 401(k)?

A 203[k] is a renovation loan, which allows a borrower to purchase or refinance a home and include additional money for repairs.    With this loan a borrower can, update a property, make optional improvements, or fix required repairs that would prohibit typical FHA financing.  Some of the repairs or renovations a borrower might typically make are

• room additions
• add a garage
• new carpet/flooring
• upgrade heating or air conditioning system
• repair a roof
• remodel a kitchen or bath
• painting interior or exterior
• landscaping
• energy efficient improvements
• repair WDI damage

This loan covers single family, 2-4 unit properties, or mixed use properties(with some restrictions).  The advantages include being able to purchase distressed properties, the loan can close prior to repairs beginning, the loan amount can go as high as 110% of the "after improved value", you have six months to complete the renovations, and the borrower can finance up to six months of payments.  This can be exceptionally handy when you are not able to live in the home while repairs are being made.
I am by no means an expert in this type of loan, since I am not a loan officer but I have some knowledge about the benefits of this loan.  If you would like to discuss how this loan may help you, please give me a call or send me an email.

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