The Top Home Improvements to Use with the FHA 203k Renovation Home Loan
A Recent study released by HUD regarding the FHA 203k Renovation Mortgage Program stated that after all work was completed homes that utilized the FHA 203k Renovation Home Loan had over 22% equity in the home.
Imagine what that can mean to a new home buyer who has bought a fixer upper with a 3.5% down payment or the home owner that is wanting to sell their home in the near future but has little to no equity in their home to realize that needed profit.
Buying that new 'bargain' home that is priced to the buyer with instant equity is a near impossible task without planning. Planning home improvements that pay you back requires strategic consideration. There are several home improvements that will provide you with the home that you want and pay you back when the time comes.
Additions: nothing adds value more than a room addition, adding a garage, or a second floor. If additions are done wisely they are the most valuable home improvement when it comes to adding value to your home. Add a second story, expand into a master suite, a new or enlarged garage, create an extra bathroom, or give yourself an extra bedroom.
Kitchen: The kitchen is usually the focal point of most homes and is a major selling point. The appearance and layout of a kitchen can often be a deal breaker in a sale and can greatly increase the value of a fixer upper. Improving a kitchen doesn't have to be a huge investment, just replacing counter tops, key appliances, or cabinet hardware can transform the look and feel.
Basement: Make the most of this bonus space by finishing it for use as a quasi apartment, office, entertainment area, additional living space or combinations of all. A finished basement has appeal to multi-generational households.
Bathroom: Along with kitchens, bathrooms tend to age or become dated quite easily. Neutralize potential design flaws or modernize by replacing the vanity, installing efficient fixtures, and choosing hardware that facilitates easy access for all.
Siding: A tight, tidy home contributes to that initial curb appeal and adds value plus takes major home improvement worries off your hands and that of any future home buyer. New siding will add to the efficiency of your home, update, and add value. Spruce up your home's exterior by installing new siding or by replacing or repairing siding for an eye-catching protective finish.
Decks and Patios: Building a deck or patio is one of the least expensive ways to extend your living space and add value. Composite decking is a great low maintenance option, and even building a deck from pressure-treated wood can bring a high return on investment.
Windows: Installing replacement windows is a home improvement that pays everyone. The home buyer and/or home seller could possibly earn valuable tax credits and the home owner will enjoy lower energy bills. Especially in older homes new windows will increase the value of a home and have the beauty and charm that all home owners desire.
Other great improvements that will add value to your home, new and updated flooring, appliances, front entry doors, utilization of attic and/or dormer space, roofing, and HVAC updates.
Financing the cost of your home improvements especially when you are buying a new home can be challenging. The FHA 203k Renovation mortgage program was designed to help new home buyers finance the cost of purchasing their new home plus adding in to the new mortgage the cost or repairing and renovating the new home.
When you already own you home the cost of repairs and renovation can be costly, and near impossible if you do not have a lot of equity in your home. The FHA 203k program can help solve that problem by refinancing your current mortgage to a low interest rate plus rolling in the cost of the renovation and repairs.
If you are utilizing the FHA 203k loan to prepare for selling your home then you win on all fronts. You have increased the value of your home, rolled the cost into a very low interest rate mortgage, that will get paid off when you sell the home. If you have done your work wisely not only will the buyer of your home helped to off set the costs you will have realized a gain after the sale that was not there when you started.
I am a FHA 203k Renovation Mortgage Specialist, I help home buyers and home owners every day realize their home dreams. If you are looking for other renovation mortgage programs like the Home Style or Home Path Renovation home loan I can help you with that too. Please, if you have any questions or would like to start the mortgage process feel free to contact me.