Question by CoolCat: Has anyone ever went with a 203K FHA mortgage?
How did that work out for you. Any details would be helpful.
Best answer:
Answer by glenn
I have seen several people try and fail. The reason most failed is that FHA required them to get firm and exact bids for the cost involved before the loan could be processed. A lot of the workmen will not give ironclad bids and will not allow the bids to be valid for so long a time.
Perhaps if the repairs were not so vast or if the workmen had a much larger profit margin than normal so they could guarantee things- maybe then it would have worked out.
I also know several people that tell me they have done this in the past and “everything was fine” but I did not see it done first hand.
What do you think? Answer below!
It can be tough because you may be dealing with complying with city requirements as well as FHA. It means jumping thru some hoops.
The FHA 203K loan is for people who have some building experience. You can be a home owner that will do their own repairs, but the estimates are necessary in order to determine the scope of the the work and amount of money needed.
I have closed only 1 FHA 203K loan and it did turn out for the good. The home owners did the work, took draws as they spent the money which is where it gets tricky.
You get approved for a certain amount for the repairs, but they must be done before they will give you the money. So you have to have several thousand dollars to get started.
Hope this helps