#i need a loan
How Do I Know I Need an FHA 203(k) loan?
January 8, 2014 July 8, 2015
QUESTION: I am a first-time home buyer preapproved for an FHA loan. I m looking at a short-sale property, and upon the initial viewing, my Realtor® suggested that the roof may or may not need work and I would need to be preapproved for a 203(k) loan before the process could continue. How do I know that I need the 203(k) loan? At what point in the process is it determined whether this type of loan is necessary? Shouldn t there be some kind of inspection involved first before this conclusion is reached?
ANSWER: You sound like a well-prepared buyer with your loan preapproval and your mention of a home inspection, which is great. You also have someone who sounds like an excellent Realtor looking out for your interests.
Your Realtor isn t a home inspector, though, so you may want to go ahead and pay for the home inspection now if you re seriously interested in this home. A home inspector will help you evaluate the condition of the home, including the roof. Since this home is a short sale, which means the sellers owe more on the home than its current value, you re not likely to be able to negotiate with the sellers to pay for repairs. This is probably why your Realtor recommended getting a preapproval for a FHA 203(k) loan.