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203k Rehab Loan

Maryland FHA Mortgage

Maryland 203k Rehab Mortgage - Learning Center.

There is a minimum down payment requirement of 3.5% of the total amount (purchase price plus repair cost)
Debt to Income ratios should be no higher than 31/43, although these numbers may vary depending on lender guidelines.
There maybe more documents required in the 203k rehab loan vs. the standard FHA loan. This may include cost of rehab, contractor requirements pay schedules and more.

In GENERAL :

The 203k rehab loan is usually used to purchase the property and make major improvements. These improvements are usually structural.
The 203k streamline is usually used to complete the home purchase and make non-structural home improvements under $35k.
Consult with a 203K specialist about your specific renovation loan needs. Request a quote and find out about your specific 203k loan requirements. Request a 203k quote.

Understanding a 203k rehab Home Loan.

The 203K rehab Maryland home loan financing is a Government loan, insured by the FHA home loan program.

This program is available to most U.S. Citizen meeting the credit, income and asset requirements and purchasing a property that meets this loans property guidelines.

The 203k is designed to assist home buyers when purchasing a property that needs repairs.  There are two types of 203k rehab loans. 

1. The first is a streamline. This loan type is for homes requiring less than $35,000 of repairs. this amount must include contingency, permits, title fees, draw fees and more.  So as an example, these fees could be $5,000 and that would leave $30,000 maximum for the repairs. This loan does not require a 203k specialist but it is recommended that the buyer has one.
This loan is designed for non-structural repairs.

2. The full 203k rehab home loan is for amounts greater $35,000 and can include structural repairs of the property. A full 203k requires a 203k specialist to determine feasibility of the project, ensures it meets FHA guidelines, sets up draw schedules and other responsibilities. A FHA 203k home loan approved lender may be able to recommend a 203k specialist.

The borrower's general requirements for the 203k FHA loan are the same for the standard FHA lending requirements.
The buyers must still have the 3.5% down payment as with any standard FHA Loan

Common documents needed when utilizing a Maryland 203k home loan.

Original pay stubs for the previous month - but you should save at least the last 3 months.
Copies of your W2 for the last 2 years - be sure you have them for all borrowers on the loan.
For refinances - Copy of homeowners insurance - if you use a specific agent you should have their contact information available for the lender.
Copies of asset information - such as proof of money for closing costs  (if needed), 3 months worth of statements from your savings & checking accounts and investment records for mutual funds, stocks, bonds or other liquid investments.
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