Government program helps fix that fixer upper

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We've written before about a special loan program commonly called the FHA 203(k).

 

This is from the Star-Ledger:

Marcus Gaither lives in East Orange, but he saw a three-family home in Newark he thought would be a good investment. Unfortunately, it was not fit to be lived in.

“It needed windows, doors, sinks, kitchen cabinets,” he said. “It needed pretty much everything. It was a total rehab.”

Gaither is a mortgage broker and had done his research on the lending industry. He knew about a mortgage that would let him buy the house and pay for the repair work before he moved in.

He purchased the property for $120,000 and made it livable.

“Some people are afraid to put themselves out as far as buying a property and making mistakes,” he said. “I’m not afraid of the loan. I think it’s a good one.”

The loan he knows about — and few others do — is the little-heard of 203(k) mortgage. It’s a primary mortgage that isn’t based on what the house is worth, but what it will be worth after repairs are made. It’s available to everyone, including first-time homebuyers, but fewer than 300 have been approved so far this year in New Jersey.

Read more . . . . .

 

 



For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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FHA has a “Little-Known Loan Program for Fixer-Uppers”

Lynnley Browning writes in the Sunday New York Times about a program through the Federal Housing Administration, FHA, for rehabilitation of “distressed homes or any other fixer-upper not only face the daunting task of turning a run-down property into a livable one, but often worry about paying for it all.”

“There’s a way to make essential repairs and add other accouterments without dipping into savings or taking out a home-equity loan. The Federal Housing Administration’s 203(k) rehabilitation program provides for loans covering renovation costs as well as the purchase price of a primary residence — investors excluded — and it allows for just a 3.5 percent down payment.”

“Although the program has been around since 1978, it is not well publicized, and many borrowers mistakenly think they have to buy a wreck in order to qualify. They don’t.”

“Covered repairs include a new roof or heating system (geothermal ones too). Decorative changes, like replacing vinyl with ceramic tile on the kitchen floor replacement, or painting the interior, are covered.”

The rates are usually a percentage point higher than conventional mortgages and certain aspects of the program can result in “closing costs $1,000 or more higher than average.”
Read the entire report.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Title Inc.

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 201-656-4506

E-mail vti@vested.com - www.vested.com

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