Monday, July 25, 2011

Fwd: Standard Loan

You don't hear about it very often but the FHA 203K Loan has been around since the 1970's. The reason you don't hear about it very often is either because the borrower is dealing with an in-experienced loan officer who just don't know about it, or doesn't want to make extra work for himself during the time of the close. It's an amazing loan and it's all I do here in this beautiful state of Colorado.

Here is how it works, and you can either do a PURCHASE or REFINANCE with this loan.

It's simple, all you do is roll in the comprehensive repairs that are to be completed by the general contractor and subs in to your loan amount.

A single contractor can coordinate a remodeling of a room, area, or entire home with multiple jobs. Whether you are planning to add a bedroom, bathroom, deck, or maybe a new kitchen, any additional square footage can be all included in to one low interest rate. This interest rate is only between 4.875%-5.625%. Not bad right?

Let me give you an example of a deal I just got done working on. The buyer purchased a home for $290,000 and the home had some problems with the foundation it rested on and it was causing a bunch of other problems.

The estimated work by the FHA HUD Consultant was around $110,000. This new loan needs to be abide by FHA County Limits which is maxed at $406,205.

The cost per square foot in this particular area of Denver is a little over $210. The property is 2800 sq feet. That will justify an after appraised value of $588,000. WOW!

Even if the buyer decided to sell the property in six months, he would be looking forward to a profit of over $180,000!


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