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Las Vegas Housing market and the FHA 203K Loan

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By : John Le Francois    99 or more times read
With the current rise in demand from the first time buyers and savvy investors the most desirable bank owned properties in Las Vegas are moving like a forest fire with the wind at its back! Many of the homes going into escrow started with multiple offers before the final offer was accepted and the sellers concessions are now typically 3% of the sales price.

With inventory being cherry picked the remainders are going to need some “Love” to make them home. FHA has the program to make this possible without having to have the extra cash to make the repairs. Realtors are aware of the program but do not understand how it works.

Buyers have to be able to qualify for the house price plus the the repair costs but are only required to have the 3.5% down payment of the total purchase price plus repair costs. Buyers can get the maximum amount of up to $35,000.00 to be used for appliances, carpets, cabinets, counter-tops, painting interior and exterior bathroom remodels and kitchen upgrades, weatherize and energy efficient upgraded heating and cooling equipment.

What it can not be used for is landscaping, patios, patio covers or any architectural blueprinting that would require permits.

The process is fairly simple to do and requires a few more documents then a regular FHA loan. The applications has to show the loan is a 203K and there is a work sheet on the cost and the maximum allowed based on the after repair value reflected on the appraisal. Repairs or upgrades that are being done will require written estimates from contractors. Contractors will be required to provide a W-9 and a FHA Contractor Agreement letter prior to signing of escrow and provide two references. All cost for repairs require a 10% hold back in case of costs over runs. After escrow has closed 50% of the estimated cost of repairs will be dispursed so the repairs or upgrades can start. The remaining balance will be paid out after the final inspection. This hold back and any additional money that is not used will be used to reduce the principle balance of the loan. All repairs must be completed within 90 days from close of escrow.

All FHA guidelines for qualifying with regards to credit, income and assets documentation remain the same. This is a great program for REO properties that may need that extra touch without having to have the additional funds to do the work.
My Name is John Le Francois and I'm a Mortgage Banker with Direct Access Lending. I have extensive knowledge with FHA, VA, Conventional loans, and Reverse Mortgages. Whether you are looking to purchase or to refinance an existing loan, I can help you to find the right product for your special needs.

With each loan that I do, I provide exclusively to all of my clients the "Process of Excellence". This is a 10-point contact system and a commitment to communicate agreement with you, the client. The contract is to select the best time and day that we can discuss the status of your loan. I will provide up to three loan programs for you to select prior to your application being taken. I attend all of my client’s closings. My goal is to provide a stress free experience in one of the most important decision in your financial life. I thank you for the opportunity to provide a quote and look forward to meeting you.

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