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Purchasing a home with a 203(k) loan

Purchasing a home with a 203(k) loan

The challenge for buyers searching for the perfect home is usually the price tag that comes with it. We might have the solution for someone willing to see potential in a home in need of a little love and some rehabilitation. Our FHA 203(k) loans offer the convenience of a loan providing the money a buyer needs to purchase the property and the funds required for the repairs. The entire process from finding a home to completion of its rehabilitation is a simple one.

Find the home and make an offer

FHA 203(k) loans make it easier to find a home because it allows buyers access to homes that might be out of their price range were they not fixer-uppers. Once a home is located, the following steps take place:

  • Buyers make an offer through their real estate broker or agent.
  • Contracts are signed with the seller containing a contingency clause making the purchase subject to the buyers being approved for an FHA 203(k) loan in the amount needed to complete the purchase and any repairs required by the mortgage lender or by the FHA.
  • Buyers meet with a representative from MortgageDepot to complete an application through an FHA 203(k)-approved lender. The application includes a proposal and detailed estimate of the scope and cost of the repairs.
  • The lender arranges for an appraisal to establish the projected value of the property after the repairs.

Our trained loan officers work closely with the lender and the buyers throughout the underwriting process that ends with a loan approval covering the cost of the purchase, the repair work and a contingency reserve to cover additional costs not covered by the original proposal and estimate of costs. For buyers who will not be occupying the home during construction, we can arrange to have up to six mortgage payments included in the cost of repairs.

Closing on the loan and the purchase

The closing is when title passes to the buyers after the seller is paid. The funds remaining from the FHA 203(k) loan are held in escrow to pay for the repairs. Money is released from escrow to a contractor at the completion of predetermined stages of work with 10 percent of each payment held until the lender checks to ensure no liens were filed by contractors or subcontractors.

MortgageDepot has the solution

We  take the challenge out of financing the purchase of a home in need of some work with FHA 203(k) loans.

Contact us today for more information at (800) 535-0270 or email us by clicking here.


Related Information:
  1. 2016 Qualifying Income
  2. 203K Loans
  3. 3.5% Down Payment for First Time Home Buyers
  4. 5% Down All Gifts Funds Allowed
  5. Apartment Lending*
Non-Conforming Jumbo Mortgages

Non-Conforming Jumbo Mortgages

We have a non-agency jumbo product that allows someone with a FICO as low as 700 to get up to 80% financing!

At Mortgage Depot we are constantly looking for mortgage programs that will meet our borrowers’ expectations. For those luxury home-buyers, we have assembled a fantastic portfolio of Jumbo products that will suffice any borrower situation.

Prior to today, the minimum credit score requirement for Jumbo loans up to 80% financing was set at 740 and now one of our wholesale lenders lowered that requirement to a credit score of 700. So if you are looking for a Jumbo mortgage and have scores between 700 and 739 then contact us we have a loan for you.

ALSO available through our company are other Jumbo programs which are listed below:

  • Jumbo Condo & co-ops allowed!
  • Jumbo 2-4 family financing available
  • Jumbo Cash-out allowed!
  • Jumbo 2nd home & Investment properties allowed
Related Information:
  1. 2016 Qualifying Income
  2. 203K Loans
  3. 3.5% Down Payment for First Time Home Buyers
  4. 5% Down All Gifts Funds Allowed
  5. Apartment Lending*
New Loan Amount Limits 2017

New Loan Amount Limits 2017

As of January 2017, the national loan amounts for both conventional and FHA loan types have increased. This shows that home prices are rising and the loan limits need to be adjusted to reflect that. At MortgageDepot, we make sure that our loan officers are always kept up to date with industry changes and always have the knowledge the structure the deal properly so it benefits the borrower and not the lender. Contact us for more information about refinancing or getting pre-qualified for a new home purchase.

Related Information:
  1. 2016 Qualifying Income
  2. Apartment Lending*
  3. Are you tired of non-performing hard money lenders?
  4. Avoiding Unreimbursed Employee Expense
FHA Annual Mortgage Insurance Premium “Reduction” 2017

FHA Annual Mortgage Insurance Premium “Reduction” 2017

As per FHA Mortgagee Letter ML2017-01, the Annual MIP rates have been lowered, for mortgages with a Closing/Disbursement date on or after January 27, 2017.  Closing/Disbursement date refers to the later of the date of the signing of the Mortgage, or the date of disbursement of the loan proceeds, as is entered in FHA Connection.  With this revision to the annual MIP rates for FHA Title II forward mortgages, FHA is eliminating the distinction in rates based upon the base loan amount.  See the following:

Keep in mind we also have new loan amounts, see below:

Express Renovation Loans

Express Renovation Loans

Anyone who has ever gone house hunting knows that no house is perfect. But many houses could be perfect if a few changes could be made; if some repairs could be done or if a new kitchen or an additional bath could be put in.

In fact, today more than ever before the housing market is flooded with homes that are undervalued, either due to neglect or because they aren’t up to date with what modern buyers want. Why not take advantage of the equity tied up in those undervalued homes by getting a home renovation loan?

MortgageDepot’s Express Renovation Loans are the perfect solution to help you unlock the potential in the undervalued real estate! What do they offer?

  • An affordable, convenient way to borrow funds to renovate or repair a property
  • A Way to save a deal threatened by repair contingencies
  • An alternative to a second mortgage or home equity line of credit
  • Options for purchases or rate and term refinance
  • Options for primary residences, secondary residences or investment properties
  • Options for individuals, non-profits or municipalities
  • Options for 1-4 unit properties
  • Loans based on the value of the home “as-completed”

Our MortgageDepot Express Renovation Loans come in two options: The Fannie Mae Renovation Loan and the FHA Renovation Loan.

Each has its benefits depending on the needs of the borrower.

Benefits of the Fannie Mae Renovation Loan:

  • Available for 2nd homes and non-owner occupied properties
  • Borrower can choose the contractor
  • If the repairs are less than $15K, no consultant is required
  • Lender Paid Mortgage Insurance (LPMI) is allowed
  • Can be used for the repair or installation of luxury items, such as a pool, additional bathrooms, kitchen renovations or additions to the structure

Benefits of the FHA Renovation Loan:

  • Available for primary residences only
  • Available to borrowers with FICO credit scores as low as 620
  • If the repairs are less than $35K, no consultant is required
  • Available for new purchases or Rate & Term refinances
  • Available with only w-2 transcripts
  • Amortized for either 30 or 15-year fixed rate terms

Don’t let the opportunity pass you by! MortgageDepot is a leading expert on renovation home loans. If you’d like to unlock the potential of an undervalued property that you own, or if you’d like to purchase a home that’s in need of repairs either to use as your own residence or as an investment property, contact us at MortgageDepot today!

To contact us by phone call 800-535-0270

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