FHA 203K -

FHA 203(k) Streamlined

FHA's Streamlined 203(k) program permits homebuyers to finance up to an additional $35,000 into their mortgage to improve or upgrade their home before move-in. With this new product, homebuyers can quickly and easily tap into cash to pay for property repairs or improvements, such as those identified by a home inspector or FHA appraiser.

Below is a description of this FHA program. For more information contact me at 586-612-5001 or submit your question by email. You can all also visit the U.S. Department of Housing and Urban Development (HUD) website for additional information.

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FHA 203(k) Covered improvements include:

Roofs, gutters, downspouts
Heating and air conditioning
Upgrade/repair plumbing, septic, well, and electrical systems
Replacement of flooring, windows, doors, siding
Weatherization, painting, basement waterproofing
Minor remodels that don’t involve structural repairs
Purchase and installation of appliances
Handicapped accessibility improvements
Anything above $15,000 in total repair cost does require a HUD inspector. This cost is roughly $500, which can be factored into the loan itself.

What items remain ineligible for the Streamlined (k) program?

Properties that require the following work items are not eligible for financing under the Streamlined (k):

Major rehabilitation or major remodeling, such as the relocation of a load-bearing wall
New construction (including room additions)
Repair of structural damage
Repairs requiring detailed drawings or architectural exhibits
Landscaping or similar site amenity improvements
Any repair or improvement requiring a work schedule longer than 6 months
Rehabilitation activities that require more than 2 payments per specialized contractor

Mortgagors may not use the Streamlined (k) program to finance any required repairs arising from the appraisal that do not appear on the list of Streamlined (k) Eligible Work Items or that would:

Necessitate a “consultant” to develop a “Specification of Repairs/Work Write-Up”
Require plans or architectural exhibits
Require a plan reviewer
Require more than 6 months to complete
Result in work not starting within 30 days after loan closing
Cause the mortgagor to be displaced from the property for more than 30 days during the time the rehabilitation work is being conducted. (FHA anticipates that, in a typical case, the mortgagor would be able to occupy the property after mortgage loan closing.)

Application Process for the Streamlined (k) program

Homebuyer locates property and signs a sales contract (purchase subject to home inspection)
Homebuyer schedules an inspection with a 203(k) cost consultant, home inspector or appraiser to budget the home improvements
Once budget is approved by borrower, cost consultant completes the work write-up and prepares contractor bid packages to obtain cost estimates
Appraiser uses work write-up to determine “as-is” and “improved value”
Loan closes with an FHA-approved 203(k) lender
Construction begins within 30 days of loan closing.
Must be completed in 6 months or less.

Ask Rocky for a Free Quote...

Raquel “Rocky” Moore
NMLS Mortgage License #138789

Mortgage 1 Inc.
45816 Schoenherr Road
Shelby Township, MI 48315
Phone 586.612.5001
Fax 586.677.3898

Interesting Links

School District Rating Site

Michigan Real Property Tax Site

First Time Home Buyer Tax Credit

Michigan Association of Realtors (MAR)

100 Questions and Answers from HUD

Michigan Mortgage Lenders Association

Home Tips

The Market

Market Watch
Bloomberg News
Fox News

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Whether you are looking to buy, refinance or receive equity from you home, my team has the perfect mortgage loan for any stage of your life. We are mortgage experts and work to understand your unique financial goals and help you make an informed decision about choosing a mortgage that fits your lifestyle. My mission is to carefully guide you through the entire mortgage loan process, so that you feel confident as you make choices about the many options available for your financing strategy.