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The AmeriFirst Home Buyer Learning Center

Dirt Cheap Housing: Perfect for an FHA 203k Home Improvement Loan

Posted by Dan Moyle on Wed, Jan 25, 2012

203k candidate house smallAn MSN article touts "dirt cheap housing" across several housing market areas. In fact a few of these homes fall within the AmeriFirst Home Mortgage geographic umbrella. the focus of this piece is homes priced under $10,000. Yes, they do exist, but as the article states they're often "difficult" homes. Many are bank-owned homes sitting vacant after the foreclosure process. Some may have appliances missing or other issues that make them "unlivable." In fact, here's an excerpt from the article:

Homes with $10,000 price tags — or even lower — are out there. There aren't many of them, of course. And you're not buying the Taj Mahal in the finest school district. Frequently these homes are bank-owned, the result of foreclosures, which can make buying them a little complicated.  

Think of it: Put down 10% on a $10,000 home and your $9,000 mortgage at a fixed 30-year mortgage rate just under 4%* would mean payments of less than $45 per month. That's about the cost of a good dinner.

So while it's possible to find one heck of a deal like this in some markets (including Detroit, Michigan and Springfield, Ohio) there could be several problems with the home. So, what's the solution? The FHA 203k home improvement loan option is great for buying a foreclosed home that needs work - whether it's a little or a lot - and rolling the cost of that work right into the cost of the monthly mortgage payment. It's a single mortgage, not a second mortgage or home equity line of credit.

Projects eligible for FHA 203k financing include:

  • Roof replacement or repair
  • Window replacement or repair
  • Flooring (required by FHA)
  • Appliance replacement
  • Put in a missing furnace or water heater
  • Repair cracked walls or foundation
  • Re-paint the house or put on new siding

These repairs are specifically targeted towards foreclosure-type homes in need of a little (or a lot of) TLC. With the FHA 203k home improvement loan you can also make desired improvements like a deck, better windows, interior paint, flooring upgrades or additional rooms.

Learn more about this great option for buying "dirt cheap housing" and turning these dog houses into dream homes. Download "The FHA 203k Survival Guide" at the button below. The guide walks you through other project you can finance, as well as the ins-and-outs of this FHA option.

Get Your FHA 203k Survival Guide

*every mortgage interest rate comes with an APR - this is the example used by MSN.com, not a quote from AmeriFirst Home Mortgage 

Topics: home improvement loans, FHA 203k, FHA Loans

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Down payment and terms shown are for informational purposes only and are not intended as an advertisement or commitment to lend.  Please contact us for an exact quote and for more information on fees and terms.  Not all borrowers will qualify.
 
AmeriFirst Home Mortgage is a division of AmeriFirst Financial Corporation. 950 Trade Centre Way Suite 400 Kalamazoo, MI 269.324.4240 Equal housing lender
 

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