As a professional one of the most important things we can do is stay abreast of the changing market and flow with the tide.  The Chicago Real Estate Market, has become saturated with REO (Real Estate Owned) and Bank Owned Properties.  However, many people that I talk to don't know how to get to optimal financing for these properties.  With an FHA loan the property must be habitable and structurally sound.  With a Conventional loan, the client needs at a minimum 5% down and most MI (Mortgage Insurance) Co., want to see 10% down and a sizable amount of reserves. Even if a buyer can qualify for a conventional mortgage, many don't have the liquid cash to do the work they would like.  So, here's a solution for you.

FHA has a 203(K) Streamline loan that allows a buyer to purchase a property and get up to $35,000 for repairs and improvements.  So why is this such a great loan product:

1. A borrower can still minimize the size of their down payment at only 3%, which can be a gift from a seller Down Payment Assistance program through Oct. 1, 2008.

2. The program can be used for 1-4 Family Single Residences; including HUD REO

3. The borrower can still choose a fixed or adjustable rate mortgage, and their are no increases to the rate to acquire the rehab money.

4. Their is only 1 closing. 

5.  The funds can be used to: Update the home (including appliances, windows, doors, roof, paint, gutters, and down spouts, upgrade to plumbing, electrical, HVAC, exterior decks and patios, etc.) This loan can even be used for MOLD REMEDIATION AND LEAD BASE PAINT STABILIZATION. Note the funds can not be used for structural or foundational corrections.

6.  A general contractor / consultant is NOT needed.

This is a great loan and should help move a lot of inventory that is currently sitting on the market. 

For more information or assistance please visit me at www.ceceliaknowsmortgages.com

Hope this was helpful!