Maryland 203k experience

[Dwight Wilcox]

Does anyone in Maryland have experience doing 203k loan(s) and renovations? What were some of your lessons learned and/or advice? Specifically looking for info on best things to do when getting started. I’m currently a tenant in BaltImore, and want to buy a place in Anne Arundel County on a 203k using the renovation funds to add a rental unit in the existing footprint (above garage apartment). Thus, creating a house hack.

[Tim G.]

What stage are you in on the process? What is your knowledge of the 203K currently? What are the zoning laws with the properties you are looking to buy? Would they allow you to add a unit like you are proposing? Part of the 203K requirements is following all zoning, code etc to the letter of the law. Their contractor requirements are stringent too, this means paying more for the work than the average investor normally would. One other big catch to the 203K is they will only lend (purchase+repairs) below the appraised value (once fixed) so you must create equity here or they won't loan on the deal. 

I wrote a detailed blog post on the 203k, I've used it on cosmetic fixer fouplex with great results. Its worth checking out. Why the FHA 203k is awesome and how to use it