Maybe you found that dream house that is a bit of a fixer upper. You may want to consider looking into a 203k HUD loan. This type of loan is geared for single family homes that are in need of major repair or renovation and meet certain criteria.
When a homebuyer wants to purchase a house in need of repair or modernization, the homebuyer usually has to obtain financing first to purchase the dwelling; additional financing to do the rehabilitation construction; and a permanent mortgage when the work is completed to pay off the interim loans with a permanent mortgage. Often the interim financing (the acquisition and construction loans) involves relatively high interest rates and short amortization periods. The Section 203(k) program was designed to address this situation. The borrower can get just one mortgage loan, at a long-term fixed (or adjustable) rate, to finance both the acquisition and the rehabilitation of the property.
If you have questions about the 203(k) program or are interested in getting a 203(k) insured mortgage loan, we suggest that you get in touch with an FHA-approved lender. Contact us to connect you with a local FHA approved lender, then work with us to complete the work and satisfy the requirements of the 203k loan.