FHA 203k mortgages in Chicago area

What Questions Should You Ask Your Lender When Applying for a Loan?

          When shopping for Chicago Area renovation loans and FHA 203k renovation loans, what questions should you ask your lender to be sure they are qualified and ensure a smooth process? Renovation loans are popular because they are flexible: you can take a property in need of a lot of work, and turn it into a good-as-new home, or find a home needing minor updates and make it the way you want. Checking Lender Experience While many lenders say they do renovation loans, it is important to find out how many they’ve actually done. One of the most important things to determine is the amount of experience your lender has with renovation loans. Renovation loans are different than traditional mortgages. Not only does the borrower need to be approved, but contractors doing the renovations need to be involved as well. Everything that needs to be done…

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How to Find the Right Lender for a Chicago FHA 203k Renovation Loan

      A renovation loan, or FHA 203k renovation loan, is a great tool for buying a home that needs some repairs or improvements to raise the value of the home. Renovation loans allow buyers to incorporate renovation costs into the mortgage in order to improve the home and raise its value immediately, rather than waiting to renovate years down the road. In addition, this can save money in comparison to a second mortgage or use credit cards to make improvements. When shopping for a lender, what questions do you need to ask when considering a renovation loan, or FHA 203k renovation loan? How Experienced Is the Lender? How many renovation loans has the lender done in the past? There are many moving parts to a renovation loan: you have to approve the situation, know the timing of everything, and know what is allowable under the terms of the…

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Chicago Renovation Loans: How Long to Close?

  How long does it take to close on a renovation loan? Many folks have heard horror stories on renovation loans, which often times can take 90 or 120 days to close. Realtors often discourage the use of renovation loans because they never close. However, renovation loans can close quickly when set up appropriately. Two main factors influence the amount of time renovation loans will take to close: making sure the loan officer gives good advice on an appropriate time schedule, and you doing your homework. When doing a renovation loan, you will go and find a property and get a contract on the home, and then determine what work needs to be done to the home. Once under contract, your list of repairs and upgrades needs to be priced out, which involves getting quotes from good contractors that will do the work. Coming up with a list of what…

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Chicago FHA 203k Mortgage Myth – the FHA 203k Rehab Mortgage is Capped at $35,000 in Repairs and Improvements

I hear on a regular basis from borrowers and Realtors, that they were interested in a particular home, but the home couldn’t work, or it could only be bought on a cash offer because it needed too much work. When I ask if they have considered the FHA 203k rehab loan, a common answer I hear is that they couldn’t use this because the property required more than the $35,000 of work that the FHA 203k allows. BZZZZZ. Wrong answer. There are two types of Chicago are FHA 203k rehab and renovation mortgages. One is a streamline FHA 203k, which is capped at a total of $35,000. But there is another loan, the full or consultant FHA 203k, which you can use for major projects. This loan can go as high as the FHA lending limits allow. So it is possible to buy a home for $50,000 and put $100,000…

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