| For many, finding the best FHA home loan should not | | | | Yet still today, first time home buyers are getting into |
| be a problem. Although there's a number of different | | | | FHA loans with $3,000.00 or more. I strongly feel if you |
| kinds of FHA homes loans, in this article we'll talk about | | | | have $3,000 - $5,000 your dream of home ownership |
| just 2 of them. For most first time home buyers this will | | | | could be just 30 days away. |
| suffice. | | | | THE BEST FHA HOME LOANS (203k) EXPLAINED |
| The first will be the FHA 203b home loan. Now if | | | | The other FHA loan is called the 203k. This loan |
| you're into technical stuff and want some good | | | | product is used far less often since it requires more |
| bedtime reading go ahead and get a copy of the | | | | for you to qualify. |
| Department of Housing and Urban Developments | | | | The way this loan product works is it allows you to |
| (HUD) handbook 4155.1 REV.4. | | | | both buy and repair a home with borrowed money. |
| It'll surely bore you to death but at least you'll see | | | | Again, the same 3% down payment requirement |
| where I'm coming from when sharing this information | | | | applies. |
| with you. | | | | Where this is different, you can buy a house in need |
| The reason we'll talk about the 203b is most likely, this | | | | of repairs. The total repairs must equal at least |
| is the best FHA home loan and used most often. | | | | $5,000.00. Like the 203b home loan you must plan to |
| THE BEST FHA HOME LOANS (203b) EXPLAINED | | | | live in the property as your primary dwelling. |
| So what does 203b stand for? That is the section | | | | So you get to add the cost of repairs on top of the |
| number under which the underwriting guidelines can be | | | | purchase price of the home. |
| found in the National Housing Act. | | | | A HUD licensed Consultant will meet with you at the |
| The main thing for the first time home buyer to know | | | | property to complete a Work Write-Up of the repairs |
| is this type of loan program is a great way to start | | | | to be made on the house. |
| down the path of homeownership. | | | | There will be mandatory repairs which will bring the |
| The US Government has this loan program in place to | | | | home up to HUD's minimum standards. Also there'll be |
| build stronger communities and to help people become | | | | some recommended repairs the borrower would like. |
| homeowners. Also it aids the US economy. Think | | | | You can act as your own general contractor, take |
| about that for just a moment. The more homeowners | | | | estimates and use these to determine costs or you |
| in a neighborhood, the stronger a community becomes. | | | | can hire the work out to a licensed professional. |
| Homeowners have pride of ownership and take good | | | | The HUD licensed Consultant will need to be paid for |
| care of their properties. | | | | this service up front before closing on your loan. This |
| To qualify for this type of FHA loan is really quite | | | | fee is normally somewhere from $400-$1,000 dollars. |
| simple. There are certain credit requirements, income | | | | The repairs must begin within 30 days of closing on |
| and other things to consider. For the most part, this is | | | | the loan and should not have any delays longer than |
| best way to get started. | | | | 30 days otherwise your loan may be called in to be |
| Many mortgage people might try to steer you away | | | | paid in full. |
| from this kind of loan product. Do your homework. | | | | The money for repairs is held in escrow until the work |
| Take it from me; this is not nearly as hard as people | | | | is completed. You can take 5 draws during the |
| make it out to be. | | | | construction process. |
| For many Loan Officers, they just do not know how | | | | The real downside to this kind of a loan, if you plan to |
| FHA loans work or just resist the extra efforts | | | | do your own work, you must have sufficient funds to |
| involved helping you to become qualified. | | | | make repairs before taking a draw. In other words, |
| If you meet with resistance when asking for | | | | you get reimbursed for completed work only. So you |
| information on FHA 203b home loans, move on. Find | | | | will have bought and installed the materials before |
| someone you trust and that has knowledge of the | | | | getting paid. |
| product. | | | | You do not get paid for your labor. Although when you |
| There is much more to this loan product. If you want to | | | | begin, you use the estimates for both labor and |
| learn more about how this can help you visit the HUD | | | | materials to determine your overall loan amount. So in |
| website. | | | | a sense, you sort of get paid for labor. Many use |
| MY FIRST HOME LOAN WAS A 203b | | | | these excess funds to make additional improvements |
| If you recall, when I was telling you my experience on | | | | on the house. |
| the home page of my website, my first home was | | | | So then really, one of the best FHA home loans is the |
| purchased under an FHA 203b home loan. Now, I didn't | | | | 203b talked about just above. |
| know that at the time because all I was looking at is | | | | If using the 203k loan, most people use a contractor |
| the $570.00 down payment. | | | | since he uses his own money to make the repairs and |
| FHA 203b loans require a 3% down payment. In my | | | | takes draws as needed. |
| case, the purchase price was $19,000.00 so my 3% | | | | Like the 203b loan, there's more to this loan product as |
| down payment equaled $570.00. So all I could think | | | | well. To find out more on the best FHA home loans |
| about was that I was going to become a homeowner | | | | visit the HUD website or request my FREE 14pg Guide |
| for a small amount of money. In fact it was equal to | | | | "10 Critical Steps for First Time Home Buyers" at my |
| about 2 months rent for me. Now this was back in | | | | website. |
| 1978 so homes are a little costlier now of course. | | | | |