Let's paint the picture:
Imagine driving down a long country road in the suburbs of Connecticut. Trees are just changing color and starting to fall on the lawns; sort of like the first snowfall, but more colorful! You are passing immaculate Victorian and Colonial houses on your left and right, and all of them have at least 2-3 acres of land.
All of a sudden, just to the right you see a completely unfinished lot. Landscaping isn't done which reveals brown dirt and burnt grass. The siding isn't completed on 2 sides of the house, and you can see into the non-existent windows that the interior of the house isn't even close to being done! As you pass by, you notice a For Sale sign in the front of the property. So, you think to yourself; who in their right mind would buy that house?
Well, for starters, I would!
No, I'm not talking about going through hard money because that is just way too expensive with interest rates. I am talking about an FHA 203k, or conventional rehabiliation loan. The FHA rehab program is structured to the same extent as a regular FHA loan. You are able to obtain up to 97% of the completed value of the home. The other conventional loan program allows for 95% financing.
So, let's visit how this works:
- You find a property that you want to move into that is unfinished or needs rehabs
- We recommend contractors and/or builders that are certfied
- If the loan limit is within FHA guidelines we take you through there, but if not we still have the option of going through a conventional rehab program.
- You close on the loan (take anywhere from a 10 year mortgage to a 30 year mortgage) - and get this....you only close once...not twice!
- Rehab on your new home is started with full benefits available to finish the construction/rehab to the home
- The work is done on the home, we get a certificate of occupancy, you move in to your discounted home!
So, let's take a look again at this situation. Would you want to invest in a house like this? Benefits are: discounted market cost, ability to make it your home, government loan rates, and you only close one time so you don't have to worry about qualifying and closing after the rehab is done to get a permanent financing loan. Simple enough, right?
If you are in the market for one of these houses, or loans, please contact me at 203-257-5279 or Andrew_Scherer@Countrywide.com.
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