VA Rehab Loan

As a fairly new program the VA Rehab Loan is pretty much an amazing combination of the the FHA 203k and VA Home Loan. The VA rehab loan includes all the benefits of a traditional VA loan including zero down payments, lower closing costs plus the ability to roll renovation and rehab costs into the same loan.

VA Renovation loan Requirements:

–Minimum repair amount is $5,000; no maximum.

– Repairs must start within 30 days and be completed within six (6) months

– Up to 5 draws; no initial draw is allowed. Inspection and title update required prior to each draw

– 15% maximum contingency required (determined by Construction Consultant) This will protect you in case of delays and/or unforeseen expenses.

– Must have fee consultant to ensure program compliance & CONTRACTORS MUST HAVE A VALID VA BUILDER ID

  1.  Self help is not permitted
  2. Underwriter will condition for Contractor’s license, liability insurance, bonding, compliance history with governing authority

VA renovation loan allowed Repairs:

  1. Major rehabilitation/remodeling, such as the relocation of a load bearing wall
  2. New construction (including room additions)
  3. Repair of structural damage
  4. Repairs requiring detailed drawings or architectural exhibits
  5. Repair/replacement/upgrade of existing HVAC systems, plumbing, and electrical systems
  6. Minor remodeling, such as kitchens, flooring, painting, window and door replacements
  7. Weatherization, including storm windows, doors, insulation, weather stripping, etc.
  8. Purchase and installation of appliances including free standing ranges, refrigerators, washers/dryers, dishwashers, and microwave ovens
  9. Accessibility improvements for persons with disabilities
  10. Basement finishing and remodeling, which does not involve structural repairs
  11. Basement waterproofing & exterior wall re siding

For more information on these loans please visit www.benefits.va.gov.

To find out how we can assist you in finding rehab properties and/or obtaining financing for a VA Rehab/ Renovation loan fill out the contact form to the right, type VA Rehab in the comments section and submit. As a Veteran Owned real estate investment company we look forward to our next mission with you.

FHA 203K Rehab Loan

The FHA 203K Rehab Home Loan is a government insured mortgage program that allows regular home buyers (not investors) the opportunity to purchase properties in need of a little TLC with the intent of making it their primary residence.

The FHA 203K Loan is perfect for:

  • Foreclosures
  • Unfinished construction
  • Property Flips (occupancy requirement)
  • Condemned Buildings
  • Abandoned Property

According to the US Department of Housing and Urban Development, the types of rehabilitation that borrowers may make using Section 203(k) financing include:

  • Structural alterations and reconstruction
  • Modernization and improvements to the home’s function
  • Elimination of health and safety hazards
  • Changes that improve appearance and eliminate obsolescence
  • Reconditioning or replacing plumbing; installing a well and/or septic system
  • Adding or replacing roofing, gutters, and downspouts
  • Adding or replacing floors and/or floor treatments
  • Major landscape work and site improvements
  • Enhancing accessibility for a disabled person
  • Making energy conservation improvements

The max FHA 203K loan amount is based on the future value after repairs are completed. To qualify for the program, the borrower must put a down payment of 3.5% of the completed (future value) of the property. The FHA 203K loan allows the borrower the opportunity to borrow the purchase price of the property PLUS renovation costs! The surplus money (renovation money) is not given directly to the borrower. The extra money is held in an escrow account and disbursed as the work is completed or materials are acquired. To prevent abuse of the program, each phase of the work must be signed off prior to the next disbursement.

To find out how we can assist you in finding rehab properties and/or obtaining financing for a FHA 203K loan fill out the contact form to the right, type 203K in the comments section and submit. We look forward to assisting you on this amazing journey