Is updating your kitchen or buying a fixer upper on your resolution list for 2020? An FHA 203k home renovation could be the solution. Read on to learn more about changes to 203k loans, the benefits of a 203k loan and more!
Changes to 203k Loan Limits
With higher loan limits for a 203k loan now allowed by the Department of Housing and Urban Development, the first 15,000 qualified buyers can now borrow up to $50,000 if the home is located within designated Opportunity Zones.
See if You’re Located in an Opportunity Zone:
What is an FHA 203k Renovation Loan?
The FHA 203k renovation loan gives eligible homeowners the power to finance major upgrades to their homes while keeping the costs as low as possible. You can gain access to a large amount of funding for repair and renovation while escaping duplicate costs of taking out more than one loan.
The government-insured FHA 203k helps home loan customers who want to repair or remodel a primary residence at the time of purchase or refinance. The lender rolls the money to finance (or refinance) a home and complete repairs into a single home loan. Budget-friendly, you can get a fixed rate with only a 3.5% down payment.
Benefits Of An FHA 203K Loan
The FHA 203k renovation loan offers great benefits just like a regular FHA loan, such as more flexible credit qualifications to get approved. And, you can borrow up to the value of the property plus the repair costs, or up to 110% of the estimated property value after the repairs are complete.
Refinance With An FHA 203K Loan
Thinking of upgrading your home and enjoying the benefits of refinancing at the same time? By consolidating the costs of home repairs into your mortgage you’ll still only have one easy monthly payment, not a separate construction loan. A 203k refinance can be used for a wide variety of projects that can protect and enhance your home’s value. Potential projects include everything from ordinary repairs common in older homes, to cosmetic changes that will give your home a fresh look, such as:
- Replace or upgrade your plumbing, electrical, heating or cooling system
- Insulate your home for greater energy efficiency
- Repair or replace your roof or gutters
- Redesign your kitchen or bath
- Add a deck
Interested in taking advantage of higher loan limits for your home renovation? Connect with a PrimeLending loan expert now to see if you qualify!