SHE LOVES THE HOME BUT HATES THE KITCHEN. WHAT TO DO?
Some properties never get to contract because of one or more of the existing physical aspects. In our market, we have several aging communities that have great floor plans but still have original kitchens or bathrooms or unfinished basements. We are seeing even more deferred maintenance and repair requirements in the inventory of lender owned foreclosures.
The answer to many of these problems is the availability of renovation financing. The most popular renovation financing for owner occupant purchasers is now the FHA 203(k) program. The regular 203(k) financing can cover very extensive repairs.
The program we love is the Streamlined 203(k) program that will cover from $5,000 to $35,000 of repairs and allows the amount to be included in the first mortgage loan. Funding for the repairs is covered by up to three draws as the needed work is completed. The allowed amount will frequently be enough to cover fixing up the kitchen or finishing a room in the basement for the teenager.
The Streamlined 203(k) program is intended to facilitate uncomplicated rehabilitation and/or improvements to a home.
Some of the allowable repairs are as follows:
* Roof, gutters and downspouts
* Upgrading heating and air conditioning systems
* Upgrading plumbing and electrical systems
* Flooring and remodeling kitchens and bathrooms when structural repairs are not necessary
* Interior and exterior painting, and the purchase of appliances
* Accessibility improvements for persons with disabilities
* Repair or replacement of decks, porches and patios
* Basement renovations including waterproofing
* Window replacements and exterior siding
* Well and septic system repairs or replacement
As you can see from this list, 203(k) can meet many needs for home improvements and allows home buyers to to it right on the front end.
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