The Federal Housing Authority has come up with a program called the 203(k) which provides assistance to those looking to rehabilitate certain homes. By working with lending companies and using the FHA?s 203(k) people may be able to buy homes they normally couldn?t afford or refinance and improve their existing home in ways that weren?t accessible before.
Section 203(k) is designed for single family properties and its larger goal is to improve a neighborhood or a community while expanding home ownership opportunities. The Department of Housing and Urban Development is committed to improving the situation in certain lower income communities and the Community Reinvestment Act or CRA is another such program than can help increase home ownership and improve the housing in these regions. Look into rolling both of these programs together to get the biggest benefit possible.?
The 203(k) is especially useful for people who want to buy property that needs some repairs or modernization. In the past such a project required a significant amount of savings or complicated renovation loans that carried high interest rates and short amortization. With the 203(k) you can roll all of these loans into one mortgage loan with more digestible rates and terms.
Several qualifications must be met for a home to qualify for the FHA?s 203(k) program so be sure to check their website and to talk to your lender to make sure you qualify and then take advantage of this government program to get the most out of your investment.