It’s a no-win situation: you can’t get a loan to buy a house until certain items are repaired or upgraded… but the repairs and upgrades can’t be done until the home has been purchased. In these situations, a Federal Housing Authority 203(k) Streamline loan can help.
What Is An FHA 203(k) Streamline Loan?
FHA 203(k) Streamline loans are an affordable financial tool you can use to buy AND fix up your home. With an FHA 203(k) Streamline loan, you may be able to purchase a property and bundle the cost of repairs, upgrades and other improvements all into one FHA loan.
The FHA 203(k) Streamline program offers homebuyers and homeowners financing up to $35,000 to make repairs, upgrades and improvements to their home. This means homeowners can get the financing they need to improve their home or make it ready for sale, while homebuyers can make the repairs and enhancements necessary to make their home move-in ready.
FHA 203(k) Streamline Loan Eligibility
FHA 203(k) Streamline loans have a few key eligibility requirements. The total cost of necessary repair work must be no greater than $35,000. The total value of the property must also fall within the FHA mortgage limit for the area.
FHA 203(k) Streamline loans cover a wide variety of different home improvement activities. Some of these activities include:
- Modernizing a home’s amenities
- Addressing safety and health hazards
- Repairing or replacing floors, plumbing or roofing, or improving energy efficiency
- Making aesthetic improvements
FHA 203(k) Streamline Loan Benefits
The FHA 203(k) Streamline program is designed specifically to help homebuyers purchase homes that need repairs or rehabilitation before becoming move-in ready. These necessary repairs are often time consuming and costly, making it difficult to obtain traditional home financing. Unlike the FHA 203(k) Streamline program, which is insured by the government, non government-sponsored home improvement loans typically have short repayment terms and high interest rates. FHA 203(k) Streamline loans offer a much more cost-effective option by offering homebuyers a single fixed or adjustable rate home loan that covers both purchasing and rehabilitating the property.
FHA 203(k) Streamline loans offer homebuyers as well as homeowners a number of significant benefits, including:
- Low down payments
- Some fees may be financed
- One loan with one closing
- Repairs can be financed
A FHA 203(k) Streamline Loan is a government-insured loan subject to certain qualifications and restrictions. A FHA 203(k) Mortgage Consultant will provide you with additional information to help you determine if you qualify. Subject to credit approval and program guidelines.
If you would like to find out more about this program please get in contact with me.