FHA 203(k) and FHA 203(b) repair escrow loan programs

What is the purpose of a Basic Home Mortgage Loan 203(b) program?

FHA 203(b) program provide mortgage insurance for a person to purchase or refinance a principal residence. The mortgage loan is funded by a lending institution, such as a mortgage company, bank, savings and loan association and the mortgage is insured by HUD.

What are the eligibility requirements for an FHA 203(b) program ?

• The borrower must meet standard FHA credit qualifications.

• The borrower is eligible for approximately 96.5% financing. The borrower is able to finance the upfront mortgage insurance premium into the mortgage. The borrower will also be responsible for paying an annual premium.

• Eligible properties are one-to-four unit structures.

What are FHA Section 203(k) Loans?

FHA Section 203(k) insurance enables home buyers and homeowners to finance both the purchase of a house and the cost of rehabilitation through a single mortgage or to finance the rehabilitation of their existing homes.

About the Author: Ahsan Bashir is an experienced Tax Consultant based in Irving, Texas, with over 25 years of expertise spanning Taxation, Accounting, Business Lending and Mortgage, Risk Management, Business Insurance, and Business Consulting. Through his firm, Z-Tax & Accounting, he provides comprehensive financial services including Individual and Business Tax Preparation, Bookkeeping, Payroll Processing, and Business Consulting. As an Enrolled Agent authorized to practice before the Internal Revenue Service (IRS), and an IRS Certifying Acceptance Agent (CAA), Ahsan Bashir delivers trusted, professional solutions tailored to the unique needs of both individuals and businesses. 

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