A starter home is typically a smaller home that needs some work. Many people end up settling for this type of home, thinking it is all that they can afford. The good news is that there is another way to frame that “starter home.” With a 203K loan you can buy a starter home that needs work and do that work so that you have a house that you love! Could you imagine buying your first home and not having to sell it or “upgrade” in a few years? That’s what 203K financing can do for you. If you are not convinced, here are 5 reasons why you should purchase that starter home with this FHA financing.
- You can make the house look just how you would want it to look. This means making cosmetic and structural changes. Do you hate the paint color? Have it painted! Do you dislike the flooring? Change the flooring! These are just a few ideas on how you can make the house look how you want – with 203K the sky is the limit.
- You can finish the basement! This is a once in a lifetime opportunity to be able to finish the basement on your starter home. Imagine the space that will add to your home! Now you will not have to rush out to move when your family starts expanding.
- You can make energy efficient changes. Windows, roofing, and solar panels are just a few of the ways that you can make your home more energy efficient. If you have the room in the loan-to-value ratio, it is well worth the investment to make these changes now.
- You can add a patio, deck, or porch to the home. This is another great incentive for a starter home that likely does not have any of these features as this is an add-on that typically takes many years to save up for, with most people moving out of their starter home before ever even building their deck or patio.
- Get a new roof! What better way to secure the stability of your house than making sure the roof is brand new? Now you not only have a stable roof, but also one that you picked out, which can greatly impact the curb appeal of your home.
These reasons are just the start of why a 203K loan makes sense when you are purchasing your first home. The FHA financing is very easy to qualify for and is fairly straightforward to obtain. If you go to a lender that has experience with this type of lending you will not have any problems going through the process. Just make sure you are using a professional that has done many of these loans as there are different aspects to it than a standard FHA loan. If your revisions are going to cost less than $35,000 you can opt for the streamlined version of the loan and not have as much work to do. But if you want the standard 203K loan, you will need to have a loan consultant, professional contractors, and a six month period in which the work can be done.
You have a say in how everything is done in the home, enabling you to move into a home that is stunning right from the start – this is not an opportunity every first time home buyer gets to take advantage of – don’t lose your chance!