So you have a house and it looks great but you want to make some changes or additions. Maybe you want to add another bedroom or remodel the kitchen. Or maybe you want to change the roof and siding. You realize this is somewhat expensive and your contractor doesn't have a reasonable payment plan available.

You think of refinancing to cash out but there isn't enough equity in the house to get the job done, maybe you could wait until the market values go up. Or you can refinance into an FHA 203(k) loan. This type of loan lets you get a mortgage on a property plus the money it would cost to make the additions or changes you want to the house and you do it all with ONE LOAN. Yes that's right it's ONE LOAN AMOUNT.

Your contractor gets paid in segments and in 6 months or less your project is complete. The best part about it is that your house may increase in equity!! Picture a house worth $250,000 and you have a mortgage of $235,000. Let's say the Appraiser says your house's "estimated after improvement value" is $350,000 once the new kitchen, roof, and siding are done and that costs $35,000 altogether. That would leave you with an estimated $80,000 of equity on the house. Sounds great right? You bet it does. If you are looking to purchase a home this is a great way to get that fixer upper. Or do you like the neighborhood but the only house for sale has an ugly kitchen and no porch? Well who cares, with the 203k you can make those changes and additions and have the costs included in the mortgage. And get this you can do it with 3.5% down if you can qualify. Pretty neat right?

And it's not hard to get the loan together either (at least in my experience) close anywhere between 30-60 days. (It takes time to get estimates from contractors so you never know). So go get whatever home you want by transforming the one you have or that one in that great neighborhood into your dream home.

Good Luck! For more info Contact Me.

Peter Botros

Senior Loan Officer

347-231-4444