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Go 203k: Any Home Can Become a Dream Home

January 5, 2016

PMC 26 Years (2)Are you planning on making 2016 the year to become a homeowner?

House hunting can be a tedious task of the whole process.  Some homebuyers can look at as many as 50 homes.  If the home has all of the basic necessities that you are looking for, but is a bit of an eye soar or just needs updating then it may be good idea to look into rehabbing the home.  Look at the home’s  “potential” to become the home of your dreams with upgrades.  Remodeling the kitchen or bathrooms can add value into the home and build equity sooner.  The program allows you to create additions with county permits.

FHA offers rehabilitation home loans.  The 203k Standard program allows up to $35,000 in repairs, which includes the fees for the work to be completed.  There is also a 203k Full program which allows unlimited repairs.  There are specific repairs that the funds can be used for.  Make sure to get pre-approved and check the guidelines before putting in an offer.

Yes, the drawback is that the rate will be higher than a standard FHA loan and it may be an inconvenience to have the work completed.  Lenders and Banks no longer offer equity line of credit over 80% loan to value so the 203k loans are perfect for many buyers.  The end result will be worth all of the trouble.  Don’t forget that you can always refinance into a conventional loan once you have 20% equity to remove the private mortgage insurance and possibly a better interest rate to save money.

The work can be completed post closing with draws made by the licensed contractor.  A final appraisal will be required once the repairs have been completed.  HUD has an approved list online: You can also request to do the repairs yourself if you have experience and tools.

You will have to meet the standard FHA requirements for credit and income.  Make sure to check with the lender to see what their minimum credit score requirement is.  Some lenders require a 580 and others may require a 640.

Download this 203k cheat sheet and training guide:



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Get Help From the Experts.  Platinum Mortgage Company also offers Stated, Low Doc, Alt-A, Sub-Prime, Non-Prime and Bank Statement Home Loans.

Credit issues? PMC Can Help….ask your loan officer about credit enhancement to get the best rate possible and save thousands of dollars in interest. Email your questions.

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