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203k - What IS it?
First of all, let us clarify...there are two types of 203k loans - the Streamline 203k and the Full
203k. They are both FHA Rehabilitation (or Renovation) Mortgage loans. Some lenders out there are doing
the Streamline version, and most are not even aware there is another version. We prefer the FULL 203K version for several
reasons, but mostly because it has more advantages, such as allowing foundation repair while the Streamline does not, and
it is much safer for the client. And though you might have other lenders telling you that no one does the Full 203k
or they are too difficult, neither is true! WE DO THEM - ANYWHERE IN TEXAS! We have the right team in place that
has done these for years, so no, we do not find them difficult and neither do our clients or agents! That being said,
all the information given in our website refers to the FULL 203K.
With this loan, a borrower can purchase or refinance a home and include additional money for repairs and/or
renovations - in one loan with one closing! Standard FHA guidelines apply for the most part, meaning a minimum
down payment of 3.5%, the seller can pay up to 6% of the sales price in assistance toward buyer's closing costs (including
REO foreclosures and individual sellers, except on a HUD foreclosure...HUD will only allow 3% assistance).
The Full 203k can be used to:
- Purchase or Refinance a Property
- "Modernize" a Property
- Fix a Required Repair
- Make Optional Improvements, such as a Room Addition or Landscaping
The Full 203k can be used for:
- Single Family Residential Properties
- 2 - 4 Unit Residential Properties
- Mixed Use (commercial and residential in one building)
- Manufactured homes
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