FHA 203k vs HomeStyle® Renovation Mortgage in St Lucie FL
Why would I use an FHA 203k loan over a HomeStyle Renovation Mortgage if they both do the same thing for me? I'm buying a home that needs some work, quite a bit of work, which program is better for me?
1) FHA has a lower down payment requirement of 3.5% - always has PMI (Private Mortgage Insurance) regardless of the amount you put down.
2) FHA has lower credit qualifications... your credit doesn't need to be stellar.
3) FHA has no limit on the amount of construction vs the amount of the purchase price
4) HomeStyle® Renovation Mortgage is for people with good credit and larger down payments typically.
5) HomeStyle® Renovation Mortgage with 20% down payment has no PMI.
6) HomeStyle® Renovation Mortgage has a cap on the amount of construction... it is 50% of the purchase price. Therefore if you pay $500,000 for a property you can only do up to $250,000 in construction. If you purchase a home for $150,000 then you can only do $75,000 in construction.
If you have a local office in the St Lucie FL area and would like us to come by and show you some ins and outs that you might not have thought of about renovation loans please call our manager in your area... Pete Campbell, St Lucie County FL