After a disaster, it might seem impossible to buy a home, but the government can help with the 203(k) programme (h). By giving disaster victims mortgage insurance, borrowers can get the money they need to buy a home or pay for repairs.
203(h) Details
After the President declares a certain area a disaster area, people in that area can get mortgage insurance through the 203(h) programme. Since a disaster can affect jobs, money, and the risk of damage to property, the government offers to take on the risk for mortgage lenders. Because of this, lending companies are willing to give mortgages to people who want to buy a home or fix one up.
Mortgage insurance, on the other hand, is not free. You will have to pay a premium up front and a premium every month. But there are some good things about this programme. For example, this type of loan doesn't need a down payment. Closing costs must be paid in cash or as part of the loan premium, but they can't be more than 5 percent of the loan amount. The FHA also sets fees, such as those for the loan's origination, appraisal, and inspection.
FHA loans are for low- and middle-income families, so the most you can borrow on a single-family home is between $172,632 and $312,895. The amount of the loan will depend on how much it costs to live in the area. The loan amount can be higher for homes with more than one unit.
FHA Lenders
FHA mortgage lenders are private financing companies, like banks and mortgage companies, that have been approved by HUD to run FHA programmes. Before choosing a lender for any kind of mortgage, you should compare interest rates. You can quickly compare the interest rates that different mortgage brokers give you online.
After the disaster, you have one year to apply for the 203(h) programme through your mortgage lender.
What Happens
By using the FHA 203(h) programme, you only have to fill out a little more paperwork to make it easier for your mortgage application to be approved. You should ask for an application for the mortgage insurance programme when you apply for a loan. Lenders who have been approved by HUD will send the application through the right channels. At this point, the rest of the process will be taken care of by the mortgage company. You will only need to fill out the final loan paperwork.
To see our list of recommended government-backed mortgage lenders online,
financing, check out this page: http://www.abcloanguide.com/govloans.shtml
