Atlanta 203K Loans

Atlanta's #1 FHA 203K Lender

Most mortgage financing plans provide only permanent financing. That is, the lender will not usually close the loan and release the mortgage proceeds unless the property meets certain property condition guidelines.

When renovation is needed a lender typically requires the improvements to be finished before a mortgage is closed.

In the current market many of Atlanta's foreclosures sit on the market in disrepair due to vandals, theft and neglect.

To traditional purchase lenders these homes are considered poor collateral and they will not provide mortgage financing for them.

However, FHA 203K are not concerned with the current condition of the property. 203K loans are only concerned that the home meets HUD's minimum property condition standards AFTER the repairs are complete!

This provides potential home-buyers an outlet to purchase dilapidated properties at deep discounts with low downpayment FHA financing.

FHA 203K loans can be used to:

1. To purchase an existing home (and the land attached to that home) to renovate it.
2. To payoff existing debt on a current residence and renovate it

The eligible improvements allowed on FHA 203K loans are numerous and extensive. About the only thing HUD frowns on are luxury improvements that are not going to be a permanent piece of the property and cosmetic landscaping.

Here are some of the most common 203K Loan repairs:

Cosmetic STREAMLINE 203K Repairs

• Paint - Interior and Exterior
• New Applicances
• Kitchen Cabinets
• Energy Efficient Windows
• Roof Repair or Replacement
• Fencing
• Bathroom Remodels or Upgrades
• HVAC Systems
• Water Heaters
• Decks and Patios
• Sheetrock
• Siding and Trim
  

Structural Consultant 203K Repairs

• Master Bedroom Additions
• Attic Build Outs
• Square Footage Additions
• Adding a 2nd Floor
• Opening a Floorplan
• Foundation Work
• Adding an Attached Garage
• Total Home Makeovers

One of the biggest misconceptions about the FHA 203K loan process is that it is hard and time consuming.

It is only hard if your loan officer is inexperienced with the process.

As far as being time consuming, whenever you involve third parties like architects and contractors you increase the amount of time a loan takes to close.

However, on most renovations their is no reason the process cannot be completed in 30-45 days from start to closing. This is especially true for the STREAMLINE 203K.

Let's dissect the two types of 203K loans in a little more detail.

The easiest and quickest version is the FHA 203K Streamline. This loan is for repairs under $35,000 that do not involve any kind of structural renovations.

For Streamline FHA 203K's you will have two draws. Generally, the lender will release 50% upfront and 50% when the work is completed.

On most of these the lender will require a final inspection to make sure the work is complete, but on some of the simpler renovations you can provide receipts showing materials have been purchased and that will be sufficient.

On the full FHA 203K, loans exceeding $35,000 or involving structural repairs, the process becomes slightly more complicated.

Many times on these when you are doing more extensive repair you will need to involve an architect and get architectural drawings so the contractor bids and appraisal are accurate.

You will also be required to have a HUD approved 203K consultant that will help determine repairs and administer draws. On the full FHA 203K loans the process often looks like this:

***Notes on the offer -- Realtors should try and include as much contingency period as possible so that the borrower and the loan officer can get the home inspection and get preliminary numbers on work required and after-repair value. This insures that the numbers will work and that home buyer earnest money is not at risk.

Obviously, the process can vary from loan to loan, but the basic process remains the same.

If done correctly FHA 203K loans are one of the absolute best and most useful loan products on the market.

Get Your 203K Quote Now!
Atlanta Home Loans
Atlanta's #1 FHA 203K Lender

Apply Now

Return to Loan Options