Michigan FHA 203k Lenders, Interest Rates and Program Highlights
The FHA 203k loan program has become fashionable with the slowdown in the housing market. When a property is owned by the lender, chances are that the property may be in need of a little work and the FHA 203k mortgage loan is a great option.
Some of the frequently asked questions we see about the FHA 203k streamline program include:
What is the Michigan FHA 203k loan?
The FHA 203k mortgage program is a restoration loan that works much like a development loan. The one who is buying the home is able to purchase a home that is in need of repairs and is able to finance the repair work in the mortgage to fix items in the house. The FHA 203k streamline program consists of the purchase price of the home plus the construction costs for the work to be performed after close.
An Example of a Possible FHA 203k in Michigan:
$100,000 purchase price of home
$20,000 Repairs Needed
$120,000 Total Loan Amount
In Michigan, when writing a contract for a FHA 203k loan, how much do I write the sales contract for?
The offer is the purchase price of the house only. Be sure not to include the cost of repairs anywhere in the sales contract or offer. In the above example, the purchase price on the sales contract or offer would be $100,000.
Is the FHA 203k loan harder to qualify for than a traditional FHA loan?
The requirements to qualify are the same as a traditional FHA loan. What does it take to qualify for an FHA loan? Generally speaking, a credit score above 620, a good job and a down payment of 3.5%. Of course there are more details to being qualified, but those are the basic requirements.
How do I find a contractor for the work?
It is really useful that you work with a general contractor that can perform all construction tasks. Your loan officer can easily help recommend one – they really should know at least one good contractor. It is also important that the contractor be seasoned in FHA guidelines so that they can include any FHA required items in their contract.
Michigan FHA 203k Loan: Ask The Experts
Getting help with your FHA 203k loan locally is easy, simply get started below and completing your information. A FHA 203k expert will be in touch and be able to answer all of your questions.