What A 203k Loan Can Do For You
The 203K loan or Rehab mortgage is an FHA loan. A 203k Loan is a cost-effective loan that allows a buyer to finance home repairs and improvements with only a 3.5% down payment.
Home buyers looking for a “fixer upper” should call their mortgage lender about this type of loan. A 203k loan creates just one mortgage that includes the home purchase and renovation. The 203k fha loan can also be used when refinancing an existing Tucson home.
Having just one mortgage transaction makes this loan attractive. It will save time and money since there is just one single set of closing costs, one loan approval and one closing.
Quick Overview Video
A 203k loan is ideal when the home being purchased requires some work. Especially when the buyer doesn’t have the extra cash to cover the costs.
The 203K Rehab Loan comes in two types – Standard and Streamline.
A Standard 203K Rehab Loan program can contain structural changes, additions, fencing and changes over $35K.
The Streamline 203k loan program is a bit more popular in the Arizona market.
Here are a few additional items to consider
Its an FHA mortgage for a primary residence only with a 30 year term.
A 203k loan will require a longer close of escrow. Usually between 45 and 60 days.
Remember to notate on the appropriate line of the Arizona Residential Purchase Contract: “Buyer obtaining a FHA 203K Rehab Loan; terms & conditions apply.”
Rehab Loans are having a return in our marketplace! As the inventory of Tucson homes for sale has shrunk, buyers are considering the “fixer” in their Tucson home search. Home buyers should determine if they are 203k eligible at the beginning of their home buying process.
Questions about the Tucson Real Estate Market or Tucson Homes for Sale?
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For more information on the FHA 203k loan program, visit the HUD website.