Cincinnati FHA203K Loan

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Using an FHA 203k loan can help you get the home you want - especially if you are looking at building some fast equity in a 'fixer upper'. Looking for a home that's almost perfect? Check out this loan to get funding for the house and any repairs that is bundled together, and a 203k loan may be easier to get than other home improvement loans. First, I'd like to share an example of how this works. We are closing on a home for a client shortly who is purchasing property for 120,000 dollars. After escrowing approximately 10,500 dollars for cosmetic and deck repairs, their "subject to" appraisal came back at 195,000 dollars! That's 64,000 dollars in equity the minute the Deed is recorded! What an awesome program! You can kill two birds with one loan.

203k Loan Bundling

Using a 203k loan allows you to combine loans for purchase (or refinance) and home improvement. This can reduce closing costs and paperwork; multiple loans mean more closing costs, and temporary loans may have higher interest rates than your 203k loan. You kill two birds with one loan.

Keep in mind that 203k loans require a little more paperwork than some other loans because you have to manage and document improvement projects.

Handle Deal Breakers

You may want to buy a home that's almost perfect. However, serious defects may scare lenders off. If sellers won't fix the problem, you can't buy the house unless you use something like a 203k loan. The lender knows you'll fix serious problems that you've agreed to fix, and they can move forward on the deal.

Temporary Housing

203k loans allow you to set money aside for housing while your repairs are completed. You can continue to pay an existing mortgage, or pay rent for up to six months. You won't have to live with an on-going construction project or come up with two housing payments each month.

Large Loans

Using a 203k loan provides access to large loans. Yes, there are limits, but you can borrow enough to finance 110% of the home's projected value after improvement. 203k loans, like other FHA loans, have low down payment requirements (for better or worse). Because they're guaranteed, the interest rate is competitive.

Improvements that Matter to You

The main benefit of 203k loans is the ability to make the improvements you want. Funding for an addition or updating the kitchen is taken care of up front. You can turn the home into something you want. If you're environmentally conscious, you can even choose green appliances and materials

There are many homes available that with a little TLC could be your dream home. A Cincinnati fixer-upper may also make a great investment, especially if you are able to do some of the labor yourself, or you are a savvy buyer. You are the person that has the vision to take that sad-looking little home on a great lot in a good location and turn it into the most desirable home on the list of Cincinnati homes for sale!

Ask your lender if they offer a 203k loan or contact Sarah Close Associates at Keller Williams and we will put you in touch with ours.