203k loan question ?

Question

I already have a rental property and now I’m looking to buy a primary home but with a 203k loan is that possible? Both places are miles apart.

Michael Noto · Answer

@Frank Rivers Do you currently own any property where you have an active FHA loan on it? How far away mileage wise are the two homes?

I had a client that was able to get multiple FHA loans, but he was relocating from Massachusetts to Connecticut for his job about 80 miles away if I remember correctly and that fit the mileage threshold for him to get the 2nd FHA loan. It could be the properties aren't far enough away or maybe the mortgage broker is not aware of the intricacies of the loan product.

Craig Bellot · Answer

@Frank Rivers, as an investor, you need to know your numbers, cold. Whether you hire out everything or are more involved, plan from the beginning to be able to step away from the business if you need to.That requires careful analysis of the property BEFORE you buy, to determine if it meets your financial goals AFTER including all expenses.If any turn key company sends you a cashflow analysis without at least TIMMUR: 1. Taxes, 2. Insurance, 3. Management, 4. Maintenance, 5. Utilities, 5. RepairsThen run for the hills.In Bridgeport, Connecticut and many North East regions we also include Snow Removal and Pest control.Explore all markets but do your research, as to where net migration and jobs are heading.

Paul Welden · Answer

Yes it is possible to buy a primary residence home using the FHA 203k while you have a non-owner occupied property.

David Robinson · Answer

@Frank Rivers I tried for FHA 203k loan, found a good property, found the approved countractor,had the estimates ready, and was denied the rehab portion at the last minute and I feel like it was because it was easier for the lender to not do it. I had to do more work on my own and put the expenses on a credit card. I turned out using half the price though , $40,000 in rehab with the 203k contractor,  and I only used $20,000 mixed on credit cards and cash,but I also didnt get as much done and had to be more picky with the projects.

Make sure the lender is extremely experience in 203k loans, ask how many have they done recently.

Lien Vuong · Answer

There should not be any barriers to 203K loan status - the only thing in question is the owner occupied status but since you refied into conventional it shouldnt be an issue.

Frank Rivers · Answer

No the rental was refinanced into a conventional loan. I was told that I didn’t qualify for the 203k because the properties were so close together.

David Robinson · Answer

@Frank Rivers Is the rental property an FHA loan?

203k loan question ?

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