Use the FHA Mortgage Specifically Created for Home Improvement

Almost everyone knows about FHA mortgages. They are tailor-made for first time homebuyers and others with less than perfect credit or other financial issues. You don't have to be low income or have bad credit to use FHA, but generally the loan limits prohibit high priced homes.

What you may not know about FHA is that there is a special loan program designed to provide the funds to buy or refinance your home PLUS additional funds to make repairs or improvements.

This FHA mortgage is called the 203K and the K is the operative part of the name. Not every lender participates in the rehab loan program, but the major national lenders do. If the loan officer you contact is unaware, then call the corporate office and ask them to direct you.

The FHA 203K loan program calls for an FHA inspector to go over the house, using the plans you gave him. Before you get to this inspection phase, you should be working with a general contractor who understands how to provide plans and specs for a project. Plans and specifications are standard in the contracting industry for anyone managing a project >$5000, which is the minimum rehab amount for this loan program.

The FHA inspector will decide if the project is feasible, depending on whether there is additional work required to bring the property up to code, and whether or not the property will appraise for enough to make the project "worth it". FHA is willing to lend based on the after-rehab value and will even stretch that value a little in order to get houses brought up to code.

Once the lender is happy with the valuations, the plans and specs, and the inspector's report, your loan file will be reviewed by an underwriter specially trained and certified in rehab loans. Your credit and finances do not have to be perfect to be approved, but the creditworthiness and qualifications are similar to a regular FHA loan.

One of the benefits of a 203K is that all costs can be added into the project. The fees, permits, closing costs, etc. are all added up and your downpayment on the purchase is calculated on the total. If you are refinancing instead of purchasing, the amounts are totaled the same way, but you might already have enough equity in the home to avoid coming up with any cash.

What's next? Once approved, the loan closes and the rehab portion of the money is escrowed by the lender. The contractor submits requests for payment and each phase is inspected. As soon as the work passes the inspection for completion, the contractor is paid. You can not go back to the well for more money, so your initial plan must be a good one. A contingency fund is usually added in during the total project calculation.

This contingency fund can only be used to fund hidden repairs that were not evident during the initial workup. Any remaining funds in the contingency are used to pay down the mortgage at the end of the project.

The FHA 203K mortgage is not a "piece of cake", but if you do not qualify for low cost money at the local home improvement equity loan bank, then it is very definately worth looking into.

Judi Moore authors Ask The Underwriter at 2rHouse.org and personally answers questions from readers about FHA mortgages and mortgage advice in general.

---

Google News Updated : Mon, 06 Oct 2008 20:48:44 GMT Campaign Attacks Intensify in the Wake of New Ads - Washington Post BBC News Campaign Attacks Intensify in the Wake of New Ads Washington Post - 1 hour ago By William Branigin and Michael Abramowitz The campaign of Republican presidential candidate John McCain went after Barack Obama again today over his past association with a 1960s radical leader, and the Democratic contender struck back by highlighting ... Video: Palin Defends Terrorist Comment Against Obama AssociatedPress POLITICS-US: Asian Americans Tilt Heavily Toward Obama Inter Press Service The Weekly Standard - Christian Science Monitor - San Francisco Chronicle - The Associated Press all 4,086 news articles Publ.Date : Mon, 06 Oct 2008 19:46:43 GMT European Researchers Win Nobels for Medicine - Washington Post Washington Post European Researchers Win Nobels for Medicine Washington Post - 1 hour ago By Rob Stein Two French researchers were awarded a Nobel Prize today for discovering the AIDS virus, bypassing an American researcher who played a key role in the discovery. Nobel is postscript to bitter 1980s HIV dispute The Associated Press Three Europeans Win the 2008 Nobel for Medicine New York Times Los Angeles Times - MSNBC - Chemical & Engineering News - Daily Mail all 843 news articles Publ.Date : Mon, 06 Oct 2008 19:12:15 GMT Postseason ace Beckett shelled as Angels win 5-4 - The Associated Press Washington Post Postseason ace Beckett shelled as Angels win 5-4 The Associated Press - 1 hour ago BOSTON (AP) - Josh Beckett waited four extra days for a chance to show his postseason brilliance. That shine wore off with his very first pitch. Video: Angels, White Sox Each Force a Game 4 AssociatedPress BoSox attempt to finish off Angels and advance to ALCS Sports Network Washington Post - Bleacher Report - FOXSports.com - MLB.com all 3,413 news articles Publ.Date : Mon, 06 Oct 2008 19:41:31 GMT IBM's cloud initiative repackages its familiar offerings - InfoWorld eFluxMedia IBM's cloud initiative repackages its familiar offerings InfoWorld - 1 hour ago By Ephraim Schwartz Mixing together a mélange of services, software and marketing, IBM's announcement this week of its Cloud Services Initiative is about putting an organizing construct around all of its cloud offerings, according to one IBM executive. IBM Puts More Tools in the InternetNews.com IBM unveils cloud computing offerings TG Daily CNNMoney.com - eWeek - CRN - VNUNet.com all 52 news articles Publ.Date : Mon, 06 Oct 2008 19:22:31 GMT Hamsters, turtles and other exotic pets can pose danger to kids - New York Daily News AFP Hamsters, turtles and other exotic pets can pose danger to kids New York Daily News - 1 hour ago Think that furry little hamster spinning on its wheel in your child’s bedroom is just a cute benign pet? Non-traditional household pets, including hamsters, mice, turtles and monkeys actually pose a health risk to young children, according to a new ... 8 Pets That Pose Major Health Threats to Kids U.S. News & World Report Exotic Pets Pose Health Risk To Children NBC 10.com AFP - eFluxMedia - The Associated Press - Mom Logic all 380 news articles Publ.Date : Mon, 06 Oct 2008 19:20:52 GMT What’s Next For OJ Simpson? - WJBF-TV BBC News What’s Next For OJ Simpson? WJBF-TV - 37 minutes ago OJ Simpson is back behind bars, convicted of kidnapping, armed robbery, and 10 other charges. Jury questionnaires, released Saturday, reveal 5 jurors disagreed with Simpson’s 1995 acquittal for murder. Video: OJ Jury: We Didn't Need Witnesses to Convict AssociatedPress Ostler: With a prison term, maybe Simpson can find real killers San Francisco Chronicle The Associated Press - Los Angeles Times - United Press International - New York Times all 3,272 news articles Publ.Date : Mon, 06 Oct 2008 20:11:20 GMT Brooke Burke: Misty May Is ‘Out of’ DWTS - People Magazine United Press International Brooke Burke: Misty May Is ‘Out of’ DWTS People Magazine - 1 hour ago It looks like Dancing with the Stars will be down one competitor when it airs Monday night. Misty May-Treanor, 31, has injured herself and is out of the competition, her castmate Brooke Burke confirms. DWTS: Will Kim Replace Injured Misty? E! Online 'Dancing with the Stars' contestant injured The Associated Press United Press International - News10.net - Baltimore Sun - Reality TV Magazine all 179 news articles Publ.Date : Mon, 06 Oct 2008 19:35:17 GMT RSS Software Web Site Traffic

PARLOT::Ebooks, Scripts, Websites, and more...

Adsense websites

An Overview of Aluminium, Plastic and Timber Conservatories

Conservatories remain a popular accoutrement and attachment to homes throughout... Read More

Feng Shui, Design Psychology and Bed Placement

I love Feng Shui! Whether you believe this ancient Asian... Read More

Single Pane Window Glass Repair in an Aluminum Frame

Let's suppose you still have those old aluminum single pane... Read More

Used But Not Used Up

Some DIY Maintence will put Used tools back in Main... Read More

Painting and Decorating Tile

Ceramic tile can be beautiful and elegant. But it can... Read More

Cork Flooring Is The Best Option Around For Durability And Aesthetic Value

It is inevitable, almost everyone no matter how long they... Read More

Protecting Yourself from Miter Saw Hazards

A miter saw, also known as a "chop saw," is... Read More

The Different Roofing Materials Used for Flatroofs, Their Advantages and Disadvantages

The roof has had many different innovations in regards to... Read More

The Wireless Home

It was only a few years ago that Real Estate... Read More

There Is Always Something To Improve Or Innovate For Comfort

In this fast moving world of the 21st century, we... Read More

Homeowners ? Here is a Step by Step Guide to Help You Hire a Quality Home Improvement Contractor

Before talking to any contractors the first thing to do... Read More

Keep Your Home Happier

It turns out your mother was right after all --... Read More

Change The Style Of Your Interior With A Minimum Of Costs

The style of your interior depends for a great part... Read More

Sump Pump Installation for Do-It-Yourselfers

According to recent surveys, over 85% of all homes with... Read More

Heated Driveways: Who, What, Where, When, Why, & How

What are heated driveways? The obvious answer is, "a driveway... Read More

Planning Your Replacement Windows Installation

Windows are the eyes of a home. From inside, you... Read More

Easy To Follow Tips For Keeping Energy Costs Down

When it comes to cooling our homes and businesses, the... Read More

Repairing a Hole in a Sheetrocked Wall

It is quite simple to repair a hole in a... Read More

Eclectic Patio Furniture Shows Your Style

Your home's interior is exquisitely decorated in your favorite style;... Read More

Bathroom Remodel - The Plan

Planning a bathroom remodel? Each home project of this nature... Read More

Area Rug Buyers Guide

When you begin decorating your home there are some important... Read More

How To Choose House Style Mailboxes

Your mailbox is not simply a receptacle for your mail;... Read More

Choosing a Home Construction or Remodeling Contractor

Choosing the right Contractor is the most important aspect of... Read More

How to Select the Best Laminate Flooring for You

Hardwood flooring - its' traditional look is almost timeless, its'... Read More

Duct Cleaning - Proper Principals and Practices

As a qualified duct cleaning contractor I have discovered that... Read More