Use the FHA 203k to Turn a Fixer-Upper in to YOUR DREAM HOME

By
Mortgage and Lending with MadisonMortgageGuys

FHA 203k Mortgage in Wisconsin, Illinois and Minnesota

If you have been riding around town looking at potential homes, you have likely encountered a common phenomena. You either find a fabulous place that is just out of your price range or you find an affordable home in a great neighborhood that needs some work. Not, oh, we can paint the walls and put down new carpet kind of work. No, this place needs some, can someone give me a sledgehammer and let me knock down two walls kind of work. Thankfully, the FHA 203k Loan specializes in that exact kind of loan.

Not a Purchase Loan and Not a Construction Loan

The FHA 203k is not a purchase loan nor a construction loan; it is both. FHA will allow people to borrow enough money to buy the home AND add enough to the loan in order to make major repairs. The loan does not allow extravagant expenditures such as adding gold plated door knobs to the front door or a $35,000 chandelier to the dining room, but most everything else is allowed. New roof, new heating and air conditioning, new appliances, new flooring, new paint, bathroom remodel, kitchen remodel and the addition of another room are all possible with the FHA 203k program.

Basic Steps

Obviously, you need to talk to a mortgage lender and get pre-approved for the home loan. Second, you will need to find a home that falls well below your affordable purchase price. Third, ask your friends and family to recommend you to a good home contractor. Then, ask the contractor to visit the home with you and the real estate agent so you can discuss what you would like to improve on the home. The contractor can draw up a formal bid and submit it to the mortgage lender. As long as the improvements add enough value to the home that the total price of purchase and repairs is less than or equal to 96.5% of the improved value, VOILA, you have a possible 203k eligible home.

For additional information, visit our FHA 203k Mortgage page of our website. If you have questions or want to see if you qualify, contact me below or apply online!

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Topic:
Home Buying
Location:
Minnesota Hennepin County Minneapolis
Tags:
wisconsin fha 203k mortgage
illinois fha 203k mortgage
minnesota fha 203k mortgage

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Rainmaker
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Elite Home Sales Team
Elite Home Sales Team OC - Corona del Mar, CA
A Tenacious and Skilled Real Estate Team

I have used the FHA 203K before and my clients liked the way it worked.

Jan 19, 2015 03:55 AM #1
Rainmaker
146,295
Madison Mortgage
MadisonMortgageGuys - Oconomowoc, WI
Serving Wisconsin, Illinois, Minnesota & Florida!

The FHA 203k is a great program Elite Home Sales Team. I've had many clients use it and have success with it. It's amazing to see the transformation when the home is complete. Thanks so much for the comment!

Jan 19, 2015 04:41 AM #2
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Rainmaker
146,295

Madison Mortgage

Serving Wisconsin, Illinois, Minnesota & Florida!
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