Home Mortgage

I have lots of questions and it seems our mortgage broker is unsure of a lot of things, let me tell you how nervous that makes me!

We were pre-approved for an FHA loan, we were looking at foreclosures as the broker mentioned the 203k streamline loan as a great option for us. We have found the home we want, put in an offer and it has been accepted. THe broker told us that all repairs needed to paid for in advance and the the reimbursments would be made after that. First he told us we did not have to have a contractor now he says we do. Please tell me how this works??! We are looking at less than $11,000 worth of repairs (new carpet, new paint, new appliances and repair/updrade lighting). Lowes has come out and quoted the carpet and we are ready to order. Appliances have been purchased and all the receipts and quotes have been turned into the broker.We are fine with paying for everything and then getting the money back. Do we have to have an additional inspection for the repairs? Who do we contact? We are in North Carolina.

Thanks! We appreciate all the help!

203K are good if you can’t get a normal loan. If you can get a regular loan then don’t do it!

Basically- HUD is a 203K loan, HUD requires you to take extra money and you must make the repairs they tell you to.
We bought our home for 102,000 and HUD requires that we do 38,000 in repairs. You have to use a licensed contractor with insurance (they must be insured for 2 years prior.) So our mortgage is 140,000 now.
Some contractors will allow you to do the work with them- but you have to talk to him about this- it’s tech. illegal but most of them will help you out. Then you will receive part of the payment. The 38,000 is held by the bank and is paid as each repair is done. You will need multiple HUD inspections and each costing $800 for the first and $125 for the additional 5 or 6 needed.

I can tell you it’s a freaken pain in the ars because HUD requires you to fix the dumbest stuff. We have to put a railing on a deck that is 5" off the ground which cost $1,400!! Instead of plastering up a crack in the ceiling- they are forcing us to put in all new dry wall…..
They basically have complete control over your repairs. I am fighting with them because I have a exposed beam kitchen that is 200 years old and they are demanding that I cover it with a traditional white ceiling so no wood is exposed.

We had to do a 203K streamline because EVERYONE refused us a regular mortage. You might have to make a lot more repairs then you thought of using it- like everything has to have a railing and we have to add extra supports in the basement and they want 200 year old logs removed from the house- which is pointless in my mind. It’s been a gaint fight with them. Don’t do it unless you have to.

Your mortage company should get your a contracter who is fimilar with HUD- you just don’t want to pick one because they need to know all their rules and regulations.

Email me if you want to chat about it more
crackfashion@yahoo.com