The condition of many of the homes for sale today is far from the rosey picture painted by agents in their on-line comments. Often agents put up pictures of the home before the place was destroyed. Consumers, visiting any one of the 6 million websites that feature homes for sale, are routinely misled about the actual shape of the homes they select to view.
Let’s face it, this kitchen needs more than a little “TLC’ ! Buyers go on their house hunting mission and soon become dismayed at the “real condition” of the homes that are listed “need a little work”. The first clue is the over grown yard. Abandoned homes often have been stripped of appliances, feature rooms with carpeting that carries suspicious stains, water damage and more. They are often “musty” (I know I am being kind) or down right foul smelling. The power and water usually are turned off. Many are secured by a deadlock and access is obtained with a key secured in a combo lock box.
Don’t shoot me, I am only sharing the truth. As an industry, we are challenged to sell these properties. Often, they are “bank owned” or they are in the limbo state where the owner has walked away and the bank is going through the foreclosure process. Some of them are listed as “short sales”, but they have been abandoned and left in a state of disrepair. Their condition is reflected in their sales price. The impact of the sale is felt by everyone in the neighborhood.
There is hope. Many of these trashed properties are not that far removed from their past glory. “TLC” implies a little elbow grease. These homes need more than can be accomplished on a free weekend. Despite the visual appearance, there is a wonderful home beneath the rubble. Not only that, home buyers have access to loan programs that will do more that “put lipstick on a pig”.
You might be surprised to learn what you can accomplish using a streamlined FHA 203k. For starters, there is no minimum amount regarding repairs and you can borrow up to $35,000 for qualified improvements. What are some of the things you can do?
You can repair or replace a roof !
You can install new windows !
You can install new floors !
You can upgrade the electrical system !
You can install a new HVAC system !
You can install new appliances !
You can remodel the kitchen !
You can change the back of your home from this
to this by adding a deck and patio !
It is no secret what a streamlined 203k can do! This program allows you to change the old saying “what you see is what you get”. You can now look beyond the condition of the home you visit and imagine what you can create using the 203k streamlined loan.
When considering what you might want to do and what may be possible, understand, there are limitations. $35,000 may sound like a lot of money (well, it is a lot of money), but home improvements vary in cost. In the DC area, a new roof can cost about $300 per 100 square feet (that is a 10′ X 10′ area), new windows will depend on the number of windows (there are several well know companies that will gladly give you an estimate), new flooring can cost about $7 to $11 per square foot, upgrading your electric can cost as much as $2,500, a new HVAC can run $8,000 and kitchen remodels can go from$15,000 and up. Just remember, you can do a lot with the loan.
Your local lender should be able to go over the loan with you. If they do not have someone that has actually done 203k loans, find another lender. You don’t need the aggravation of having your lender stumble through the requirements at your expense. Use an experienced local lender.
Oh, if you need help finding the right house (in Washington DC or the Maryland suburbs), well that is one of my services. I also listen to dreams, hold hands and support my clients from home search through settlement. I can be reached easily by calling 301-509-5111.