# FHA 203k loan?



## sfsbhs (Jun 4, 2013)

I'm looking at purchasing a house built in the 1880s. It is huge and was actually much larger until it caught fire almost a century ago. It is an octagon house with a porch almost the entire way around . I've lived in it as a rental and now it's for sale, with a 13 yr old house and the 10 acres they sit on. If there are no loan types to finance 2 houses on a single property, the estate will split it apart. My questions.....
Does anyone know of a loan that will finance 2 homes on 1 property?
Does anyone know if a 130 your old house can be financed? 
Does anyone know about fha 203k home improvement loans?


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## Conhntr (Aug 7, 2010)

How long have you been renting?
Have you been making all on time payments/ being a good renter?
Would a mortage payment be similar to what youve been paying in rent?


Sounds like you might be in a good situation to inquire about seller financing. You will need a decent downpayment to make it attractive 

I dont see a conventional or 203k being likely on that property

Edit; if you go on zillow.com and look in their forums there are speific sections for these types of questions and actual underwriters etc post there. Alot of people post trying to sell you (get a commision off you) but alot of good info can be found. Bottom line is only way to know for sure is to try but could waste alot of time


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## KENlawrence (Jul 11, 2014)

FHA 203k home improvement loans, is a type of loan that lets a buyer financing the cost of improvements into the purchase or refinance of the home. However, youâll need to hire an FHA person to appraise the home improvement efforts. Just like my brother in law, he asked a loan officer from Prospect Mortgage to discuss the details and provide a description of how the 203(k) process works.


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## kilgrosh (Apr 29, 2014)

I would talk to Farm Credit. When I was looking at farms, ranches, and land, they were more acceptable of strange properties (two homes, multiple outbuildings, no habitable residence, etc.) and willing to finance. Also, I would talk to a local credit union. They might be more understanding of your situation and can structure a loan to meet your needs. 

As far as I know, a 203K has a lot of moving parts and approvals. You need to have a renovation plan approved, several bids on the work costs, regular status checks during the renovation, cost audits, and on and on. These types of loans can be helpful to get you the cash you need to renovate, especially if the house needs a lot of work. But I think there is a limit, like 5% of the borrowing amount or something like that. Many lenders don't like these types of loans because they are a lot of work on their part and a higher risk that the owner won't complete the work if something major occurs (new foundation needed, complete overhaul of the plumbing, etc.) and default on the loan. 

Seller financing might be a good idea, like previously mentioned. Also, ask about lease-to-own options. 

Two building properties are not unheard of. I just did a quick search online and found many that have an older home and an newer home on the property. My concern would be that the newer home wasn't completely legal and when the deed changes hands, you have to tear it down or not live in it.


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## Kaos (Oct 7, 2008)

It basically comes down to a few things regarding your situation.
Appraised value of the property, your credit score and your debt-to-income ratio. 
My suggestion would be to contact some banks in your area and discuss what you are trying to do. May be surprised to find some are actually willing to help you.
Good luck.


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## KENlawrence (Jul 11, 2014)

Btw, in case you need an FHA-approved loan expert, you can find one here http://www.zillow.com/profile/ProspectMortgage/Reviews/ (this is where my brother-in-law discovered his loan specialist). Anyway, I completely agree with Kaos . FHA loan is an excellent help for your house renovation, especially if youâre running out of cash. Bottom line, whether youâre a first-time home buyer looking to relocate, or just want to move into a bigger place, an FHA loan could be a good option.


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## joshcheney (Feb 2, 2011)

I just closed a 203k, and it was a royal pain in the neck. The buyers (and sellers) were extremely frustrated with how long it took, and how difficult it was to get the folks involved to do their jobs. 

I represented the seller, not the buyer, so I'm not sure how the lender/consultant was selected, but I know that by the time we figured out they were incompetent, the buyer had already invested several thousand dollars of non-recoupable money in the deal, and felt that they had to carry through with it.

YMMV


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