FHA 203k RehabS
What is an FHA 203k Loan?
An FHA 203k loan is basically the same as a regular FHA (called a 203b), but with a twist. An FHA 203k loan permits borrowers to include repair/improvement money into their mortgage used to repair, improve, or upgrade their home. With this loan option, borrowers can quickly and easily tap into cash to pay for property repairs or improvements, such as those identified by a 203k Consultant, FHA appraiser or home buyer preferences. There are two types of FHA 203, Loans: Standard & the Limited. The FHA 203k Standard loan is more like a construction project, and the FHA Limited 203k Loan is for minor improvements.
What are the benefits of using an FHA 203k Loan?
The purchase of a house that needs repair is often a catch-22 situation, because the bank will not lend the money to buy the house until the repairs are complete, and the repairs cannot be done until the house has been purchased. The FHA 203k loan program can help you with this quagmire and allow you to purchase or refinance a property and include in the loan, the cost of making the repairs and improvements. In addition, the interest on the FHA 203k loan qualifies for the mortgage interest tax deductions like all other mortgage loans. Therefore, the interest that the borrower pays on this “construction” can be all tax deductible! …
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