203K Loans Provide A Great Opportunity For Buyers In Shaw
Renovations in Shaw continue to sell quickly and at high prices. However, buyers looking to “build equity” and put money into shell or partially rehabbed properties have a tremendous opportunity in Shaw using 203 K loans. The neighborhood has been improving for 30+ years and some of the early renovations are in need of a facelift. 203k loans provide an owner occupant the ability to buy a home (that needs work) at any price (supported by an “as is” appraisal) and add a renovation loan for improvements (supported by a “as completed” appraisal). To qualify, you need a credit score of 640 or higher and a down-payment of 3.5 percent of the total purchase price and renovation costs. Therefore, if you buy a home for $100,000 that needs $50,000 worth of repairs, then you need a down-payment of only $5,250. The mortgage can be used to renovate one- to four-family homes. This includes conversions from a two-family to a single-family or a six-family to a four-family. The trick is that the final renovation must be a four-family or smaller. The 203k mortgage finances structural alterations and reconstruction, structural, tuck pointing, new roofs and gutters, new and updated kitchens and baths, flooring and tile, energy conservation improvements, major landscaping elements – decks and grading, and upgrading systems, such as electric, plumbing, furnaces, air conditioners, water heaters. Further, the buyer may be eligible for the 25% historic tax credit. The tax credit is paid for every dollar you spend in the construction process (plumbing, electric, drywall, paint, etc excluding appliances, patios and some other restrictions. The SNHC can assist in educating the buyer about the historic tax credit program. Many people are surprised to learn about all the incentives provided for new home buyers in Shaw. As voted “Best Place to Live” by the Riverfront Times in 2010, Shaw is an increasingly trendy and popular place to live. If you would like more information 0n any of these programs, please contact me at our office or just drop in! We are here to help.