Published on March 1st, 2011 | by Genevieve Williams1
I would buy a “fixer-upper”, but don’t have the money to fix it up!
Everyone knows that when you buy the home with all the updates you pay more. Very often buyers fall in with a certain neighborhood, but cannot afford the home with all the updates. So then they look at some of the homes that need a face-lift or are fixer-uppers. More often than not they realize that to be able to do the updates or renovations they would like they need too much cash out of pocket than what they have.
One option for these buyers is the 203k Loan, which is a loan made on the value of what the home would be with the updates made. For instance, you found a home in a great neighborhood, but it needed extensive work; more than just a couple thousand dollars worth of work. Lets just say you can get it for $200,000 and it needs $30,000 worth of work. Well, with the 203k Loan the bank would loan you $230,000: $200,000 to purchase the home and $30,000 to hire a contractor to fix it up. Even better is that there is an FHA 203k Loan, which means that you only have to put down 3.5%!
So, you want the details
What can be done?
- Repair/replacement of roofs, gutters and downspouts
- Repair/replacement/upgrade existing HVAC systems
- Repair/replacement/upgrade plumbing and electrical systems
- Repair/replacement flooring
- Minor remodeling, such as kitchens, which does not involve structural repairs
- Painting, exterior and/or interior
- Weatherization, including storm windows and doors, insulations, weather stripping, etc.
- Purchase and installation of appliances, including free-standing ranges, refrigerators, washer/dryers, dishwashers and microwave ovens.
- Accessibility improvements for person with disabilities
- Septic system and/or well repair and/or replacement
- Other minor remodeling
What can’t be done?
- Major rehabilitation or major remodeling, such as the relocation of a wall
- New construction
- Repair of structural damage
- Repairs requiring detailed drawings, plans or architectural exhibits
- Pool improvements/repair
- Anything taking longer than 3 months to complete
So go ahead and buy that fixer-upper in the neighborhood your love!
Oh, and here is the perfect Chantilly Fixer Upper…