The Federal Housing Administration (FHA) insures the FHA 203(k) loan, providing homeowners and home buyers with funding for both the purchase price of a property and necessary repairs. An FHA 203(k) Loan can be a 15- or a 30-year fixed-rate mortgage, or an adjustable-rate mortgage (ARM). Borrowed funds may be used to finance expenses related to materials and labor. Unlike conventional mortgages, 203(k) loans are government-insured. This has the added benefit of more flexible qualification terms and requirements.
The FHA 203(k) loan allows you to finance or refinance a home that needs significant care and improvement. Any expenses related to these improvements are added to the total amount you borrow and can be paid off over time as you pay your monthly mortgage payments. Therefore, an FHA 203(k) loan can provide a cost-effective way to pay for many home improvements — especially for larger repairs due to storm damage such as hurricane-force winds. As with any mortgage, you’ll need to qualify to obtain an FHA 203K loan based on your income, credit history, credit score, debt-to-income ratio, and other factors. To find out if an FHA 203(k) loan is right for you, call Sword Mortgage at 770-826-0222 to speak to an experienced mortgage professional or get started on your loan application process today.
Streamline 203(k) Loan
The 203(k) limited loan is most often used for homes needing fewer repairs. This type of loan allows the borrower to finance a maximum of $35,000 for renovations with no minimum cost requirement attached to the property being purchased or refinanced. But keep in mind that you can’t include major structural repairs when calculating how much money you want to borrow.
Standard 203(k) Loan
The 203(k) loan is typically used for bigger projects that surpass $35,000 and can be used to finance major structural repairs. Nevertheless, renovations must cost a minimum of $5,000, and a consultant from the U.S Department of Housing and Urban Development (HUD) has to be hired to manage the project and the renovation process obediently. There are also some specific rules and guidelines that have to followed so that it adheres to government code. The professionals at Sword Mortgage can guide you through the entire loan process, provide you with the best options available, and simplify the entire process.
Contact Sword Mortgage Today To See If A 203(k) Loan Is Right For You
At Sword Mortgage, we believe that an informed customer is the best kind of customer. Therefore, our loan officers will take the time to fully explain your options and help you understand all aspects of your unique situation before making a decision. Call 770-826-0222 to speak to a mortgage professional or get started on your loan application process today.
