Tag Archives: down payment assistance

How to buy a home that needs work or rehabbing

  When you’re searching for a home these days you’ll find some that meet your needs but they need work or have been vandalized.  If you’re getting an FHA loan then you may not be able to purchase these homes.  However, there is an excellent program that you can use for these homes.  It’s called the FHA 203k Streamline Mortgage.

Who is Eligible?    This program is for buyers that are purchasing for their primary residence.  It’s also available for owner occupants that want to refinance their current home.  Nonprofit organizations can also qualify for this loan program. It is not available to investors who will not be living in the property.

What properties are available ?  The program is focused on single-family, owner-occupied properties, but it is not limited to those. Buyers can also use this loan to purchase condominiums or town homes. It can be used to purchase multi-family properties of up to 4 units.

What are the loan requirements ?  The FHA 203(K) Streamline loan was designed for properties that required light or cosmetic repairs. For this reason, the program has a cap of $35,000 for repairs and other costs. There is no minimum repair cost for this loan. Other costs include the loan’s closingcosts, up to two inspections fees, a certified inspection report and a supplemental origination fee.  The loan can be either a fixed-rate loan or an adjustable-rate mortgage (ARM).   The outstanding mortgage balance cannot exceed the purchase price of the house.   The money designated for the rehab are held in escrow and is paid out after the work is complete. Any excess funds in escrow after the work is complete will be applied to the principal balance.

What are the rehab requirements?  The rehab work must commence within 30 days after closing and must be completed within 6 months.   Contractors must be licensed and bonded.   The FHA 203(K) Streamline loan cannot be used for repairs that HUD considers to be ‘major.’ This includes any new construction to the property, such as adding on a new room. It cannot be used to finance any structural repairs needed on the property. All rehab work must be completed within 6 months. It can not include landscaping.  If you’d like to learn more about rehab financing we’d be happy to answer any questions you may have.  Just give us a call or send us an email.  We’re ready to help !

Home Buyers Downpayment Assistance

   One of the hurdles facing home buyers today is coming up with a down payment.  Often for first time home buyers the monthly payment is the about the same as their current rent.  Saving up the down payment is a bigger issue.  Fortunately there are programs out there to help out such buyers.  Here is a summary.  Give us a call if you’d like to learn more.

  • The HUD $100 Down Payment Program – This is a program where you can buy a HUD foreclosure with as little as $100 down.  The home has to be a HUD foreclosure.  It’s an FHA program and you can go through your own lender.   You still will have to come up with the earnest money which can be as much as $1,000.  There are no income limits.
  • The Georgia Dream Program – This program can be used on any home in the state of Georgia.  You are given down payment assistance in the form of a forgivable second mortgage.  With this program there are income limits and limits on the purchase price of the home.  Also with this loan your interest rate will be about a half a point higher.
  • The HUD Good Neighbor Next Door Program – This program isn’t actually a down payment program but I did want to mention it.  If you are a full-time law enforcement officer, pre Kindergarten through 12th grade teacher, firefighter or emergency medical technicians then you may be eligible to purchase a HUD home at as much as a 50% discount.  There are only certain properties that are available under this program.
  • Atlanta Down Payment Assistance – The city of Atlanta offers several programs including homes along the beltline, a Vine City specific loan aand a city wide down payment assistance program.  The beltline program is limited to a very few addresses in the city but the city does offer an FHA loan with down payment assistance in the form of a forgivable second mortgage.  There are income limits but the down payment assistance can be as much as $10,000.  There are also limits on the value of the house  (currently about $250,000).

If you’re thinking of buying a home and think one of these programs might work for you give us a call or shoot us an email.  We’ll help you every step of the way.