Posted on: 06th Feb, 2010 08:37 am
I just placed a contract on a property that has been stripped of carpet, ac unit,kitchen cabinets,bathroom fitures and toliets,all doors,electric panels box and flooring in most rooms. I am not sure which loan would be better for me FHA or USDA since I qualify for both? I am going to need to need money to make repairs as well. The appraised value decreased quit a bit due to the homes condition but its still more than the sales price. Will I have to go up to the appraised value with either an FHA 203k or USDA loan?
If you need to do repairs, then you should go with the FHA 203k loan. That loan will allow you to pull additional funds out to cover the costs of some or all of the improvements that you want to make.
USDA guaranteed home loans don't allow repairs to be taken into the mortgage. It operates like the standard FHA-insured mortgage and VA guaranteed home loan programs. Only the 203k program allows repairs.
