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Updated over 9 years ago on . Most recent reply

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Sean Myers
  • Investor
  • Arnold, MD
1
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Anyone in Maryland used a 203K for a Live & Flip?

Sean Myers
  • Investor
  • Arnold, MD
Posted

I've decided to make my next investment a "live and flip". The plan is to buy a distressed property at the right price and use a 203K loan to fund the bulk of the rehab work. Once that work is done I'll be an owner occupant for the required two years. 

So my first question to you fine folks is has anyone gone through this process in the Anne Arundel County area? My main concern is a seller rejecting an offer he or she would have otherwise accepted for fear of the drawn out 203K process about which I've read so much. I imagine for a distressed property I'd be looking at a "full 203K" and I read some real nightmare stories.

Question #2 is whether anyone has ever rehabbed a SFR to include a legal accessory dwelling unit (In-Law- Apartment) in this area? If so, how did the process with Zoning and Planning / permitting go?

Thanks in advance for any advice.

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Shawn Gageby
  • Contractor
  • Chesapeake Beach, MD
8
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21
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Shawn Gageby
  • Contractor
  • Chesapeake Beach, MD
Replied

@Sean Myers I'm into the first 6 months of my 2 years of this process.  Getting the 203K set up did take extra time, but once you get to closing the seller walks away with their money then the construction process starts.  There is 2 different types of 203K (Full and Lite) the full is for amounts of work greater than 35K and requires hiring a  203k consultant for the project that ensures that the work is being done correctly.  They work as your advocate.  The lite version can be done without the consultant.  

My property appraised for about 20% above the loan. Still have to pay PMI though until I Refi it.

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