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203k Rehab Loans

Orlando 203k LoansFlorida FHA 203k Rehab Loans

The Florida FHA 203k Renovation Loan allows borrowers in Orlando to finance additional renovations costs into a loan amount that may be necessary for financing, as well as the basic cosmetic upgrades, such as new paint, carpet, cabinets, kitches….

FHA 203k loans allow buyers to purchase foreclosures and short sales that are sitting vacant due to any rehab work needed to make the property move-in ready.

In addition to minor cosmetic upgrades, this loan can be used to completely remodel most 1-4 unit dwellings, and borrowers can even finance in up to 6 month’s (principal, interest, tax and insurance) payments to avoid having to worry about additional housing costs while the property is being renovated.


Basics of Florida FHA 203k Rehab Loans

Have you found that “almost perfect” home in the right location that is selling at a reduced price because it needs a little rehab work?

Unfortunately, most mortgage loan programs require homes “in need of work” to be complete before the financing can be secured for the purchase transaction.

Whether the property needs a little or a lot of work, most First-Time Home Buyers simply don’t have the up-front cash to invest in a property prior to actually securing the financing.

However, the FHA 203k Rehab Loan may be your answer to turning that “fixer-upper” into your dream home.

The FHA 203k Rehab Loan is a popular mortgage program designed for buyers that want to finance the cost of home improvements into a new loan.

The financing for this loan will include the purchase price, as well as the improvements you are either required to do to be able to live in the home, or that you want to do, such as upgrade the kitchen, bathroom, etc.

This is also a great loan program for agents trying to sell homes that need repair. Buyers will have an option to complete those repairs and upgrades without a large upfront financial commitment.

Think of this as a one-time close construction loan.

At closing, the seller receives their money and the rest is put into an escrow account for the buyer to use for rehabbing the property.

The Florida FHA 203k Renovation Loan is a great option for borrowers in Orlando who are looking to purchase a home that needs work. A borrower can obtain an FHA 203k Renovation Loan for most renovations that can add value to their Orlando home as well as cover other needed expenses associated with the renovation such as permits, labor and material costs as long as the borrower is intending to live in the home as a primary residence.

There are two different kinds of Florida 203k Loans; a Standard Florida FHA 203k loan and a Streamline Florida 203k Loan. The standard loan is more suited for properties that need major (structural) repairs, such as the streamline 203k loan suits properties that need cosmetic repairs (non-structural). The streamline 203k loan allows for a max of $35,000 above the purchase price needed for improvements, whereas the max for the Standard FHA 203k loan is of 110% of the purchase price (or the cost of repairs, whichever is less).


The Benefits of Florida FHA 203k Renovation Loans

The 203k loan program has many advantages, one truly unique feature and benefit of a 203k loan that stands out for borrowers is that the program allows for the borrower to include up to 20% contingency reserved for repair expenses that exceed their estimates. Additionally, the program also allows the borrower to defer payments for up to six months during renovation.

  • Available for both purchase and refinance
  • Flexible qualified credit ability to roll in most closing costs
  • Able to use it for both distressed and non-distressed properties and major renovations
  • Low down payment requirements
  • Allows borrowers to borrow against the future value of the property once improvements are made.

Many Orlando homeowners believe the 203k Loan is only intended for rehabilitation, but that is not the case. The FHA 203k Renovation loan is also a great loan choice for a property that isn’t distressed but for homeowners who are simply considering remodeling.

Another reason the Florida FHA 203k Renovation Loan is an excellent choice for Orlando home improvements is that the loan criteria allows the homeowners to borrow against the future value of the property once the improvements are made; opposed to the present value of the property like other loan programs.

If you’re considering renovating your Orlando property or simply perform a home improvement project and need a loan, you have many options to choose from.

One of the best programs available and specifically designed for rehab and home improvement is the Florida FHA 203k Renovation Loan. It offers unique benefits that no other program has, so if you or someone you know is considering the purchase of a distressed property or perhaps a kitchen or bathroom renovation; have them look into a Florida FHA 203k Renovation Loan.