The FHA 203K Loan Program has been developed to assist in the repair and improvement of owner occupied 1-4 family homes. The program allows a homeowner to finance up to 97.75% of the after improved value of a home. It may be used in both purchase and refinance transactions.
The FHA 203K Loan Program is one of the most underrated and flexible mortgage loan programs available, with closings at competitive rates. The program allows for most home improvements, including upgrades and decorative items. It may also be used to upgrade the energy efficiency of your home. There is no minimum in the amount of work to be completed. It may be used for either small jobs, or complete overhauls to a property.
The 203K Loan Program process goes as follows:
- The property is identified.
- The scope of the project is determined with a HUD 203K consultant.
- The contractor and homeowner agree to the specifications laid out by the consultant.
- An appraisal is performed on the property establishing both an “As Is” and “As Completed” value.
- The loan is underwritten and conditions are met.
- The loan closes and the work on the property begins.
- In 1 to 5 draws, the contractor is paid. There is NO money upfront for the contractor to begin work.
- With each draw, there is a 10% hold back to assure the completion of the job.
- The work is completed and the township issues the proper approvals.
- The contractor is paid the final draw, including the hold back.
- The process is complete, with no additional requirement to refinance.
To have this process explained to you in very simple terms, call McEvoy Homes and speak with Mike McEvoy. He will answer your questions and show you how easy construction financing can be.
Regardless of your financial situation or construction needs, the FHA 203K Loan Program may be right for you.
Please call McEvoy Homes today to be connected with a qualified FHA 203K Lender.