The home of your dreams could be in need of some costly renovations before a lender will provide the financing to purchase it. The professional loan officers at MortgageDepot have a solution with our home repair escrow programs. We work with a variety of lenders to find the loan that suits your needs and budget.
FHA 203k loans
Traditional mortgage financing provides borrowers with the funds needed for the balance of the price of a home based upon its appraised valuation. The property being purchased must be in livable condition for it to be capable of being appraised.
The FHA 203k program provides funding for the acquisition of a property that is in less than pristine condition. The key feature of the loan program is the availability of funds to complete the purchase of a home based upon its appraised value after completion of repairs required to make it livable. Program features include:
- Buyers may borrow the funds needed to complete repairs and make the purchase.
- Borrowed funds may be used to finance temporary housing while repairs are completed.
- Repairs and renovations must be completed within six months.
Part of the application process for an FHA 203k loan includes preparation of a list of repairs that must be completed to increase the value of the property to an amount required to satisfy underwriting guidelines. The money to fund those repairs is placed in escrow after the closing on the purchase of the home and disbursed as the work is completed.
Alternative programs to FHA 203k
Some of our lenders offer alternatives to FHA 203k loans for homes that do not require extensive renovations. Features of these alternative loans include:
- Funding to acquire the property.
- Up to $5,000 in escrow to pay for repairs.
- Up to 15 days to complete the work.
- Repair requirements based upon estimate from a licensed contractor.
Home repair escrow loans are available on FHA, VA and other types of loan products.
Contact us today