When I spoke to my mortgage broker, she mentioned the 203k Rehab loan. She outlined the basics of it and said if I was interested she could put me in touch with her coworker, who is the 203k specialist at the brokerage.
Let me say right here... that I cannot recommend enough that you work with a brokerage that specializes in 203k loans. With the research I've done, all of the complaints and pitfalls stem from first-time or inexperienced home buyers trying to figure this process out on their own.
After my broker mentioned the 203k product, I got to googling. The wealth of information can be found on the HUD website obviously. There are two types of 203k loans: Streamlined and Conventional. The basic differences are that the Streamlined has a maximum loan amount of $35,000 whereas the Conventional can go to 110% of the home cost. Let me mentioned here... that I am cheap. Champagne tastes on a water budget! So... I was absolutely positive I was going with the streamlined. Period end of story. Hrmph.
I met with the 203k mortgage broker, we went over the paper work (just a taste of paper work to come). I laid out the things I saw that needed to get done:
* Plumbing: missing pipes in basement
* Heating: old oil tank, I want to convert to gas
* Floors: yank the horrific laminate flooring and refinish the hardwoods.
* Bath: Paint over existing tiles
* Kitchen: Replace cabinet doors and get new appliances
All for less than $35k... yeah right.
My 203k mortgage broker referred me to a 203k consultant. A 203k consultant is not required for Streamlined 203k loans. But its $800 one time charge and they are required for the conventional 203k. [I had a feeling I was going to want to up my budget when I got into the house so I went with the consultant. I think even if I did stick to the $35k budget I would prefer to have the consultant. He knows the in's and out's of this loan process and was a great resource.]
I set my home inspection for Martin Luther King Day (no time off of work for me, yay) and luckily, my 203k consultant could also meet me that day.
Unfortunately I am about to get a taste of what its like to deal with a corporate owned property.
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