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How to get an FHA loan to purchase a fixer-upper home
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There are many people who want to get a great deal on a home by buying a
fixer-upper that needs work. If you are handy and want to get a home
you
can fix yourself, the FHA offers loans for these types of homes.
The FHA has Rehabilitation Loans that will give homebuyers a mortgage loan to purchase a
home that is in need of repair. The home buyer will have to work with
the
FHA, inspectors, and contractors to understand exactly what is wrong
with
the home, get estimates for home much these repairs will cost, and then
determine the reasonable value of the home. Then the FHA will take the
amount of money they determine the house will be worth AFTER the
repairs are
completed and subtract the amount of the purchase price to determine how
much the homebuyer will have to pay for the repairs.
Then the mortgage loan will include the cost of the home and amount of
the
repairs. The money to repair the home will be in an escrow account and
paid
out when each repair is complete, or on the contractor’s fee schedule.
For more information on buyer a home that is in need of repairs with an
FHA
loan go to the FHA Mortgage Center.com's FHA
Lending
Guide
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