What is FHA 203(k) Financing?

Long Beach, CA. This US Governments housing program has been in existence since the 1990’s.  Its purpose allows a home buyer the opportunity to finance into a 30 year fixed mortgage upgrades and repairs they want up to $35000 above and beyond the sales price.  Below outlines how these funds may be utilized.

Finance your kitchen appliances such as refrigerator, stove built in microwave, dishwasher, hot water heater, built in trash compactor as part of your 30 year fixed FHA loan.  Energy efficient appliances may be eligible for additional rebates from the local utility company.  As just signed by rebates from the local utility company.  As just signed by President Obama, buyers may qualify for up to a $1500 tax credit for energy efficient upgrades too!

Repairs financed may include: new carpeting, install or refinish hardwood floors, install energy efficient windows, replace a worn leaky roof, replace damaged or worn out kitchen and bathroom fixtures; termite clearance !!!

Get the electrical and plumbing updated and upgraded.

Mixed use properties eligible

Subject to maximum percentage of commercial use.

1-4 unit owner occupied homes

Single family residences, condos and townhomes allowed.

Licensed general contractor generally needed and required.

Close escrow in  60 days

Today, we will see three homes with 30 year fixed payments of $1288, $1304 and $2214 respectively!

$289,000 List Price for

9209 Laurel Street Bellflower, Ca 90706

$289,000 list price

$10,115 3.5% FHA down payment

$278,885 base loan amount

$20,000 FHA 203(k) added for upgrades

$298,885 base loan amount

$1,004.00 per month 1^st mortgage 5.5% 30 year fixed FHA 203(k)

$50.00 per month estimated home owners insurance

$301.04 per month estimated property taxes

$136.99 per estimated private mortgage insurance

$2,214.76 per month PITI

Estimated closing costs based on a 640 credit score is 4% to 4.5% of the sales price. If the seller pays all closing costs, cash needed is:

$10,115 down payment

$425 FHA 203(k) appraisal

$275 inspection

$10,815 total estimate cash needed

Proposed items to upgrade:

Replace Roof

Energy efficient water heater/dishwasher

Paint interior

$149,000 List Price for

5545 Lime Avenue Long Beach, Ca 90805

$149,000 list price

$5,215 3.5% FHA down payment

$143,785 base loan amount

$30,000 FHA 203(k) added for upgrades

$173,785 base loan amount

$1,004.00 per month 1^st mortgage 5.5% 30 year fixed FHA 203(k)

$50.00 per month estimated home owners insurance

$155.21 per month estimated property taxes

$79.65 per estimated private mortgage insurance

$1,288.86 per month PITI

Estimated closing costs based on a 640 credit score is 4% to 4.5% of the sales price. If the seller pays all closing costs, cash needed is:

$5,215 down payment

$425 FHA 203(k) appraisal

$275 inspection

$5,915 total estimate cash needed

Proposed items to upgrade:

All new energy efficient windows and exterior doors

Flooring

All light fixtures

Energy efficient water heater

Wall furnace heater

Paint interior and exterior

$160,000 List Price for

38 East Platt Street Avenue Long Beach, Ca 90805

$160,000 list price

$5,600 3.5% FHA down payment

$154,400 base loan amount

$20,000 FHA 203(k) added for upgrades

$174,400 base loan amount

$1,007.55 per month 1^st mortgage 5.5% 30 year fixed FHA 203(k)

$50.00 per month estimated home owners insurance

$166.67 per month estimated property taxes

$79.93 per estimated private mortgage insurance

$1,304.15 per month PITI

Estimated closing costs based on a 640 credit score is 4% to 4.5% of the sales price. If the seller pays all closing costs, cash needed is:

$5,600 down payment

$425 FHA 203(k) appraisal

$275 inspection

$6,300 total estimate cash needed

Proposed items to upgrade:

All new energy efficient windows and exterior doors

Flooring

All light fixtures

Energy efficient water heater

Wall furnace heater

Paint interior and exterior

Repair kitchen cabinets/install new sink   

Kirk Mulhearn, a Long Beach Real Estate Real Estate Broker manages the Prudential California Realty office in Bixby Knolls, he also co-manages a GEM Mortgage Net Branch, a direct lender specializing in FHA, VA, and conventional financing.  He can be reached at 562-989-4608 ext. 110 

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