For a long time, the FHA 203(k) loan was one of the only ways to have a borrower could get money for HUD home repairs, without taking out an additional loan. The FHA 203(k) loan will lend the estimated value of the property post-repair. For example, if a property’s current value is $70,000, but it could be worth $100,000 if certain repairs are made, the borrower can get a loan for up to $100,000.
Now, a growing number of private lenders are offering tempting alternatives. Consider the Wells Fargo Home Asset Management Account. This loan combines a first mortgage with a home equity line of credit. The borrower is able to draw upon his equity in the form of a HELOC, without making multiple applications. As the equity grows, so does the HELOC limit. This makes it especially easy for a borrower to make repairs on his HUD home at a low interest rate.
Keep checking back, we’ll soon have a new section on financing HUD foreclosure homes.
See Also: Where to Find HUD Homes for Sale
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