If you have found a home that needs some TLC to become your dream home, don’t let it slip through your fingers. You don’t need to apply for different loans for this. The FHA 203k Rehab Loan is the best option to make your dream home a reality.
Let’s do some research to understand more about the FHA 203k Loans in MA
An FHA 203k loan, also known as a rehab loan, covers two important stages –
1) House Acquisition
This loan program finances both major challenges, buying and fixing up, when buying a home despite its initial condition.
Prospective home buyers often shy away from homes that need renovations. Most of them cannot come up with the cash for a new roof or new flooring in addition to a down payment. Here’s where the FHA Rehab Loan comes in. Some of the major benefits of this program are listed below:
1) Covers renovation as well as purchase costs under one single program.
2) Payments for the renovation can be spread over the life of the loan.
3) Interest paid on these components is eligible for income tax deductions.
There are some important steps to follow when buying a home that needs fixing-up with an FHA 203k Loan. Unlike a regular loan, an FHA Rehab Loan allows you to submit your list of improvements. Here are the steps you need to complete:
1) Apply for the loan.
2) Get a pre-approval letter.
3) Find a property that you would like to buy.
4) Approach an FHA 203(k) lender if your improvement costs exceed the amount specified for the loan.
5) The loan offer will arrange a detailed proposal from licensed contractors containing the scope of the work to be done and a detailed cost estimate.
6) Approaching a contractor to draft an estimate of work needed and materials required is necessary unless you are a professional builder.
7) After the approval from the lender, you will get a home appraisal – with and without improvements.
If you already have selected a home that you want to buy nut needs some repairs, you can start approaching the most experienced mortgage lenders for 203k loans in MA. For a detailed consultation, you can call on of our loan officers.