Richmond, VA · Member since 2018 · 10 posts · 1 vote
I started the process for a 203 k conventional loan for a residential primary residence and estimated the rehab wrong. The rehab cost are more than I estimated which made the closing cost higher. In order for me to complete the deal, am I able to go back to a regular conventional loan to afford the down payment and closing cost? Thank you to those who reply to this question.
Lender · Glenview IL- CDLP NMLS#230554 · Member since 2015 · 2k+ posts · 747 votes
6y
@Jonathan Marrow The file has to resubmit again with new product-most of the lender has this requirement but you can ask your lender if they can flip to other product.
Real Estate Agent · Tempe, AZ · Member since 2011 · 1k+ posts · 543 votes
6y
Not to split hairs but there is no such thing as a 203k conventional loan. The 203k is an FHA Loan. There are some conventional renovation loans such as the Fannie Mae Homestyle and the Freddie Mac ChoiceRenovation, and VA also has a renovation loan.
So, where you talking about switching from an FHA 203k to a regular FHA (aka FHA 203b)? Or switching from a conventional rehab loan to a non-rehab conventional loan?
For a switch from an FHA 203k to FHA 203b, it should be an easy switch for the lender to make for you. but I think it may be a bit more involved on the conventional side. Either way, a switch can definitely be made.
Be aware that some properties will ONLY qualify for rehab loans (or cash) based on their current condition.