The U.S. Federal Housing Administration, commonly known as FHA, is a government agency that was started in 1934 after the great depression. Presently, the FHA is governed by the Department of Housing and Urban Development, which is the sole government agency that generates its operating budget. The Housing and Urban Development, HUD department is responsible for making the U.S. citizens some of the best-housed people in the entire world. The FHA is also responsible for overseeing several insurance plans for single-family mortgages. These loans are generally given by HUD-approved lending entities and are insured by the FHA. To be eligible, borrowers must have a good credit rating and pay a certain amount in down payment. Learn more about the FHA 203k loans with Arizona Mortgage Pros.
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Arizona 203k loans: All-in-one rehab plus mortgage financing
The FHA 203k mortgage is a unique loan plan that is designed to make it easy for individuals to purchase a home that needs repair or repairing an already existing home. The mortgage loan helps roll the mortgage and repair costs into the loan. The FHA 203k rehab loan is a HUD’s main loan product for the repair of single-family homes. The loans are made to help individual homeowners and not investors or commercial builders. The down payment for these loans can be as low as 3.5% and hence very popular among the low to moderate-income families. This loan is also accessible to non-profits and local government entities, but the final home has to be used as the primary private residence.
203k loan requirements
FHA 203k loans are not only used for home improvements but also for helping communities to revitalize across U.S. One of the main objectives of both HUD and the FHA is to raise ownership opportunities as well as preventing homes requiring repair from being abandoned. The 203k renovation loans can now finance the rehabilitation, fixes, and improvements to the existing house in these ways:
The current home that is located in one area is allowed to be moved to another area. Nevertheless, the new foundation must be given and inspected thoroughly and adequately secured to the foundation.
A home, with the land it sits on, can be purchased and rehabilitated. 1-4 family houses are eligible and incorporate detached single-family homes. 1-4 condominium units only qualify for interior repairs and improvements.
Besides, the Arizona FHA 203k loan covers the following improvements:
- Landscape work and enhancements to improve home value
- Installation of energy-efficient doors and windows
- Adding accessibility for disabled individuals
- Porch, Deck, and patio additions
- Carports and garage
- Extra room additions
- Improvements to plumbing, air condition, heating, and electrical wiring
- Kitchen and bathroom remodeling
- Lead paint removal
- Adding septic systems
- Repairing structural problems, termite damage, and chimney repairs
- Flooring and floor treatment
Other types of improvements can be eligible, depending on several factors.
Nevertheless, certain restrictions apply for 203k loans in Arizona. These conditions must meet specific structural standards and specific energy efficiency standards that are set by the HUD in order to qualify. To get more information on the FHA 203k loans, contact an Arizona loan specialist today at Arizona Mortgage Pros.