Ohio FHA 203k Program Highlights
The FHA 203k mortgage program has become in demand with the downturn in the housing market. When a property is owned by the bank, chances are that the property may be in need of a little work and the FHA 203k loan is a great option.
Some of the frequently asked questions we see about the FHA 203k mortgage loan include:
What exactly is an FHA 203k loan?
The Ohio FHA 203k mortgage program is a rehabilitation loan that works much like a construction loan. The one who is buying the home is able to pay for a home that is in need of repairs and is able to mortgage the repair work in the mortgage to correct items in the house. The FHA 203k mortgage program consists of the purchase price of the home plus the construction costs for the work to be performed after close.
An FHA 203k Example Situation:
- $100,000 purchase price of home
- $20,000 Repairs Needed (see a list of the most common FHA 203k repairs)
- $120,000 Total Loan Amount
How much to write the contract for?
The offer is the purchase price of the dwelling only. Do not include the cost of repairs anywhere in the sales contract or offer. In the above example, the purchase price on the sales agreement or offer would be $100,000.
Is the FHA 203k loan harder to qualify for than a traditional FHA loan?
Getting an FHA 203k loan is roughly the same as getting a regular 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 able to qualify, but those are the general requirements.
How do I go about finding the right contractor for the work?
It is encouraged that you work with a general contractor that can perform all repair work. Your loan officer can easily help recommend one – they ought to know at least one good contractor. It is also critical that the contractor be experienced in FHA guidelines so that they can include any FHA required items in their contract.
Ohio FHA 203k Mortgage: Get More Information
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.