What Are The Requirements To Qualify For Florida FHA 203k Loans

This BLOG On Florida FHA 203k Loans Was Updated On April 29,2017

Gustan Cho Associates are experts in Florida FHA 203k Loans.  Florida FHA 203k Loans require minimum credit scores of 580 FICO.  The Gustan Cho Team does not have any lender overlays on FHA Loans and are specialists in originating and funding Florida FHA 203k Loans.

HUD Section 203(k) insurance enables home buyers to purchase a home that is in need of rehab with a combo home loan that includes the acquisition and rehab costs all in one single loan closing.

Here Is How Home Purchase Florida FHA 203k Loans Work

  • Home buyers can purchase a tear down or home that is not habitable and need in rehab with an acquisition and construction loan
  • Florida FHA 203k Loans: Lenders require that borrower will need 3.5% down payment on the after improved value
  • FHA 203k Streamline Rehab Loans allows a maximum construction budget of $35,000
  • There are no maximum construction budget with a full standard FHA 203k Loan. Maximum loan amount is the FHA Loan Limits
  • Only one to four unit owner occupant properties are eligible for 203k Loans

Here Is How Refinance Florida FHA 203k Loans Work

Current homeowners that need a rehab loan can do it with a FHA 203k Loan.

Here is how it works:

  • The current loan will be paid off with the new FHA 203k Loan
  • There is a construction budget reserve
  • Once rehab is complete, the FHA 203k Loan will be a 30 fixed rate mortgage FHA Loan. No need to refinance again unless the homeowner can get net tangible benefit

Construction And Acquisition Loans In Florida

Gustan Cho Associates has several types of Acquisition and Rehab Loans available in the state of Florida:

  • Florida FHA 203k Loans
  • Fix And Flip Loans
  • Hard Money Loans

Florida Fix And Flip Loans

The Gustan Cho Team has fix and flip rehab loans.

Here is how fix and flip rehab loans work:

  • 15% down payment on home purchase
  • 90% financing on rehab costs
  • 9 months interest only
  • For investment properties only

Here is how hard money loans with rehab costs work:

  • There are two types of hard money loan programs: Owner occupied and non-owner occupant investment property loans
  • 25% down payment on home purchase and 25% down payment on rehab costs

HUD Section 203(k) Mortgage Insurance

Under HUD Section 203(k) Mortgage Insurance , home buyers can purchase a home that is not habitable which includes foreclosures and can obtain an acquisition and rehab combination mortgage loan called FHA 203k Loans. When purchasing a home that need rehab, buyers normally have to abide by a process streamlined by HUD. There are two types of 203k’s:

  • 203k Streamline which is a maximum construction budget of $35,000
  • Full Standard 203k Loans: No construction budget limit

Here is how it works

  • With Streamline 203k, homeowners cannot do any structural changes or room additions
  • Full Standard 203k, homeowners can do cosmetic, structural, and room additions

Florida FHA 203k Lenders

HUD 203k mortgages offers homeowners to have an acquisition and construction loan with one loan process and closing with low down payment. Home buyers of fixer uppers can now purchase a home in need of rehab and do a complete gut rehab with only 3.5% of the after value of the home. Most construction lenders require 30% or more equity but not with a HUD 203 rehab loan.

Basics Of HUD 203k Loans

The type and extent of the construction covered by Section 203(k) mortgage insurance ranges from minor cosmetic repair to a full gut rehab construction project. Only one to four unit residential owner occupied units qualify for this program.

The types and scope of construction that borrowers qualify in using Section 203(k) financing include:

  • Structural changes and room additions
  • Updating the home externally and internally 
  • New appliances
  • Updating home with health and safety defects and hazards
  • Cosmetic repairs which include replacing roof, siding, windows, gutters, and other cosmetic features
  • Minor and major plumbing, electrical, HVAC, and septic/well systems
  • Refinishing and/or replacing floors, millwork, kitchens, bathrooms, and basement remodeling
  • Minor and/or major landscaping and lot improvements
  • Handicap access to home: Exterior and interior
  • High efficiency energy systems

Home buyers who have any questions on FHA Rehab Loans, please contact The Gustan Cho Team at 262-878-1965 or text Gustan at 262-716-8151 or email us at gcho@gustancho.com.

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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