Today's lending environment can be a challenging in some areas especially in the construction and rehab lending area, for that reason, the 203(k) s program shines and should become a staple in product knowledge for any realtor that is currently marketing a property.
How it works? - The buyer of a home can obtain financing above and beyond the purchase price for rehab, remodel, improving the home as long as the subject to appraised value warrants the value of financing the cost of those improvements. The new purchase mortgage is done for the purchase price along with funds for improvements that are held in escrow once the improvements are done.
Improvements should be done in a reasonable amount of time (there is a time limit) and should be done by a professional who is a tradedsmen in that line of work.
The funds are then disbursed to both the owner and the contractor - after an inspection is completed, to ensure the work has been done and both the homeowner and the bank holding the mortgage is satisfied.
This is done with One closing , one set of closing costs - and a locked in rate at the time of that closing.
It makes a property that needs some care more marketable knowing that this program is there - and could be utilized.
Should you have any questions about this program feel free to email me or call me.
Account Executive ~ Oklahoma
Mortgage Investment Services Corporation
NMLSR Identifier #194708
25055 W Valley Pkwy, Ste 108
Olathe, KS 66061
913-390-1010 x 1035