We need to think outside the box in today's real estate market. It was just reported the home ownership is at 50 year low at 62.9 percent. It hard to believe that with the lower interest rate this could happen, inventory is tight and money just as tight.
So as agent we need to think outside the box and bring new tools to our customers that help them achieve their goal of homeowner. Most buyer today go the common route and get a bank loan, but then find out the house does not qualify because of needed repair. The move on to the next house on the list. Is there a way to keep this deal alive and close?
The Federal Housing Administration FHA has a program for limited rehab. The house is appraised and a list of repairs that are required is given to the lender and the buyer. The loan comes in two parts the first loan to buy the property as is and a second loan to make repairs.when the repairs are complete both loans are blended together to form one loan payment.
As agents we need to be knowable so that we can explain and answer question for our customers as well as know when to make this type of loan available to out customer. We should know this the first time we walk through the property, this property will required a rehab loan. Start by explaining to your customer that this property may require special financing. We can not do this if we don't understand the program.
So what is the name of the FHA Rehab Program? Some of you I sure know it well but for those of you that don't know I taking about FHA 203K. Yes there are other program out there but FHA 203K is one of the largest and very easy to use. Most big banks have a department that specializes in this type of loan.
You can begin by do a search for FHA 203K and also ask you preferred lender if they do rehab loans.