FHA Offers Rehabilitation Loans On Distressed Properties

by ritasimpson on June 23, 2012

in Foreclosures

Foreclosures and short sales in Malibu always look so enticing, but these kinds of deals are not for the faint-hearted or those on slim resources. Buying a Malibu residence that is not newly built usually requires immediate rehabilitation and remodeling to be followed by regular maintenance. Taking on a  Malibu foreclosure or short-sale property only ratchets up the process with more intensive rehabbing and certainly a lot more maintenance.

There is one often overlooked resource that can help: a  203(k) loan. It’s one of the most overlooked FHA programs that can help with a Malibu residence that is not newly built and requires immediate rehabilitation.

That’s unfortunate, because it is a great selling point.

Just a few notes from the FHA 203(k) loan website:

–This is the Department of Housing and Urban Development’s primary program for the rehabilitation and repair of single-family properties.

–The program operates through FHA-approved lending institutions, which submit applications to have the property appraised and have the buyer’s credit approved.

–To purchase a dwelling and the land on which the dwelling is located and rehabilitate it, and to refinance existing indebtedness and rehabilitate such a dwelling, the mortgage must be a first lien on the property.

The best feature of this loan is that it can be rolled into the mortgage.

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