FHA is the United States’ Federal Housing Administration, the government agency that was developed in 1934 after the great depression. In the present day, FHA is governed by the Department of Housing and Urban Development, HUD, which is the only government agency generating its budget of operation. HUD helps make the United States citizens one of the best-housed populations in the globe. FHA oversees several insurance programs for single-family mortgages. These loans are offered by HUD-approved lending institutions and are insured by the FHA. Borrowers must, however, have a satisfactory credit rating and also provide a down payment. Learn more about the FHA 203k loans with Florida Mortgage Pros.
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Florida 203k Loans: All-in-one Rehab plus Mortgage Financing
FHA 203k mortgage is a particular loan program that is designed to make it easy for individuals to buy a home that requires repair or financing the needed repairs to the existing home. The mortgage loan will help roll the repair costs and mortgage into the loan. The FHA 203k rehab loans are HUD’s primary loan products for the rehabilitation and repair of single-family homes. These loans are designed to benefit individual homeowners and not commercial builders or investors. In most cases, the required down payment for these loans can be as low as 3.5%, and thus very attractive to lower and moderate-income families. This loan also allows for local government entities and non-profits, but the final home must be used as a primary private residence.
203k Loan Requirements
Besides being home improvement loans, the FHA 203k loan is an essential tool for the communities to revitalize across the country. One of the main goals for both FHA and HUD is to increase homeownership opportunities and prevent homes in need of repair from being abandoned. The general rehabilitation, improvements, and fixes to the existing how can be done by utilizing 203k renovation loans in one of the following ways:
An existing home or modular unit that is located on one site is allowed to be moved to another location. However, a new foundation must be provided and inspected properly and appropriately secured to the foundation.
A home, together with the land it sits on, can be bought and rehabilitated. One-to-four family houses re-eligible, and include detached single-family houses and townhomes. One-to-four condominium units only qualify for interior improvements and repairs.
Also, Florida FHA 203k loans cover a number of improvements, such as:
- Landscape work and enhancements to improve home value
- Adding accessibility for a disabled individual
- Installation of energy-efficient windows and doors
- Garages and carports
- Porch, deck, and patio additions
- Extra room additions
- Improvements to plumbing, heating, air conditioning, and electrical wiring
- Lead paint removal
- Kitchen and bathroom remodeling
- Addition of septic systems
- Flooring and floor treatment
- Repair of structural problems, chimney repairs and termite damage
Other improvement types may also be eligible. However, certain restrictions do apply for the 203k loans and must meet specific structural standards and certain energy efficiency standards that are set by HUD to qualify. For more information on FHA Section 203k loans, contact our Florida home loan specialists from Florida Mortgage Pros today.