FHA LOAN PRODUCTS
•Mortgage Insurance for Single Family Homes - Section 203(b)
–Eligible properties are one-to-four unit structures.
–Mortgage insurance to purchase or refinance a principal residence
–Borrower is eligible for approximately 96.5% financing
–Borrower can finance the upfront mortgage insurance premium
–Repair Escrow program up to $5,000
•Streamlined 203(k) Limited Repair
–Minor Repairs and Improvements (upgrades)
–Repair costs up to $35,000 (value permitting)
–No minimum repair cost threshold
–Repairs are completed after closing with loan proceeds
–Same 3.5% down payment requirement for purchases
–No inspection required (If less than $15,000)
–Appliances (including free-standing ranges, refrigerators, washers/dryers, dishwashers and microwaves)
–Environmental mitigations
–Modifications involving disturbance of pre-1978 paint surfaces - Lead based paint abatement
Ineligible Work Items
–Major rehabilitation , remodeling or structural (such as the relocation of a load-bearing wall)
–New construction (including room additions)
•No general contractor required
•Great tool for HUD Properties
•Eligible Work Items
–Repair/Replace/upgrade
•roofs, gutters and downspouts
•existing HVAC systems, plumbing, and electrical systems
•existing flooring
–Minor remodeling (non-structural) repairs
–Exterior and interior painting
–Weatherization
•Contractors and Rehabilitation Criteria
–Borrower must use licensed and bonded contractors
–“Self-help” is discouraged but acceptable IF the borrower can sufficiently demonstrate to the lender that he/she has the necessary expertise and experience to competently perform the work
203(k) Standard Rehab Mortgage Insurance Product
One mortgage loan for acquisition and rehabilitation
–Same low down payment 3.5%
All Improvements Eligible
•Maximum loan amount is the lesser of:
–Maximum mortgage limit for area (base mortgage amount)
–Purchase price plus cost of rehabilitation 110% of “After Improved” value
For futher details click here.