Boston area housing costs can be some of the highest in the nation. Many times, first-time buyer are pretty strapped for funds to do renovations / updates after they have scrapped together funds for the down payment, closing costs and beer for their friends for helping them move.
A program that a lot of home buyers are unaware of is the FHA 203K loan. This program allows the costs of needed repairs and improvements to be included in the FHA federally-insured loan amount instead of having the buyer come up with cash or a separate loan to do the work.
The work has to be done within six months after escrow closes. Borrowers have the option of putting up to six months of mortgage payments on the end of the loan if they don't want to live in the house while the work is being done.
FHA home loans require certain health and safety standards be met and that needed repairs identified during the inspection process be completed before escrow closes. However, minor repairs and improvements costing between $5,000 and $15,000 can be done after escrow closes for borrowers who opt for a streamlined repair program.
The loans can also be used to pay for improvements such as new appliances, second-story additions, remodeled kitchens and bathrooms, and skylights, just to name a few examples.
It is important that home buyers utilizing the 203K program work with a lender that experienced with the program since there are a lot of nuances to making sure everything is processed correctly.
Gary Dwyer, CRS, GRI, ABR, REALTOR
Buyer Agents of Boston, LLC - Exclusive Buyer Agents Serving Greater Boston
806 Tremont St, #2
Boston, MA 02118
617 997-5570 - Voice
617 507-8104 - Fax
