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Remember, we’re more than a roofer. We can handle anything from exterior to interior work. Roofing, drywall, paint, flooring, kitchens and baths, you name it!
Throughout the 203k process many steps are involved for both the homeowner and their 203k contractor. From permits to inspections, draws to final invoicing, our knowledge of the 203k home loan process will assist you in getting your new home (or current) rehabbed to your liking.
Currently Columbus is a booming real estate city, with many opportunities to invest in a new home. From Old Town East to Grandview and many of the other historical districts, older homes are being rejuvenated all around the city. How a 203k loan can help is by providing the funds to fix up a home you want to invest in, without taking money right out of your pocket.
Again, we are a certified 203k Contractor. That certifications helps us be able to help you through the process. Here’s a short description of what our education process entails:
Becoming a Certified 203k Contractor by being approved to be listed on the National Directory of Certified 203k Contractors for an FHA 203k loan (click here for national Certified 203k Contractor directory from 203kContractors.com), involves education and testing as well as verification of credentials, references and residential remodel/rehabilitation/construction experience. The 203k Contractor Certification program enables contractors to have the knowledge necessary to master their role as a 203k Contractor, properly and efficiently participate with 203k remodeling jobs and to connect with borrowers, lenders, sellers, asset managers and real estate agents who are in need of a Certified 203k Contractor
The process is pretty simple. Let’s say you want to buy a $200,000 home, and want $30,000 in remodeling done to it. This would qualify for a Streamline 203k loan (assuming no structural changes). The bank would then allow for a disbursement of half the funds up front. This will allow us to pay our labor bills, while the material is paid for using our accounts. Once the work is complete the mortgage company would do an inspection and the final total amounts would be released. Your $200,000 home, now with $30,000 in remodeling, is now a $230,000 mortgage. Most remodels of this kind raise the value of the home beyond the $30,000 investment, which is instant equity for you!
The best part is that even if you already own your home the FHA 203k rehab loan is a great opportunity for refinancing! You can refinance, hire a 203k contractor in Columbus, and then have a full remodel done on your home.
Here are some benefits of using a 203k home loan and a 203k Contractor in Columbus:
203k Benefits to Buyers/Borrowers
- Renovate home with little/no additional out-of-pocket expense
- Low down payment (3.5%)
- Combine purchase/refinance + rehab funds into one low-interest, tax-deductible mortgage which is based on the improved appraised value
- Include mortgage payments into 203k if home is not livable during the remodeling
- Submit a strong purchase offer if presented properly to seller
- Buyers face less competition from other buyers to purchase fixer-uppers, foreclosures or older homes that are outdated
- Better opportunities for “good deals” on home purchases
- Ability to purchase properties that may not meet FHA standards and complete the repairs/improvements AFTER the home is purchased.
- Select from a larger selection of properties for sale (in any condition), including condos, townhouses, mixed-us, multi-family, single-family dwellings and those that do not currently meet FHA standards
- When offer is presented properly to seller, 203k offers may be advantageous in a competing offer situation as the seller does not have to fix-up or repair the property but instead allow the buyer to include these items into their 203k mortgage and complete the improvements after closing using the buyer’s own style and design.
203k Benefits to Home Owners & Sellers
- Market property to more buyers
- Allow buyers the opportunity to renovate, upgrade or improve to suit their tastes and preferences
- No need to settle for low-ball cash offers
- Current condition of property not required to meet FHA’s property standards
- Buyer is permitted to correct any property deficiencies after close of escrow
- No more inspection concerns
- Absolutely no repairs are required prior to close of escrow
- Seller not responsible for cost of repairs/improvements
- Transaction will close with property in “AS-IS condition
- Closing occurs in 45 days
203k Benefits to Realtors® & Lenders
- Increase income by selling more homes and originating more loans
- Raise real estate values by improving homes and neighborhoods
- Decrease foreclosure inventory
- Help buyers who previously could not buy homes
- Help seller/owners with properties in outdated or fix-up condition
- Spur economic growth by creating job opportunities for the construction/remodeling industry
- Promote an under-utilized niche program that not many Realtors® or Lenders understand
- Revitalize your community
So you may be asking, which 203k loan is right for your remodel? Whether streamline or full, we are equipped to help you through the entire 203k process.
The FHA 203k Standard/Full allows for structural modifications, additions, landscaping, and architect and engineer contracting, and requires the use of a HUD approved 203k Consultant. The remodeling cost for the Standard/Full 203k version is minimum $5,000 and the maximum is the FHA mortgage limit for the area in which the property is located (up to $1.4Million – some restrictions apply). Click Here to access the maximum FHA mortgage limits for all areas.
The Streamline 203k version, on the other hand, will not allow for structural modifications, landscaping, etc., and remodeling changes have no minimum amount but have a maximum limit of $35,000 (some restrictions apply).
Looking for a Realtor who is familiar with the 203k or other rehab loan process? Check below!