Section 203(k) provides FHA insurance to homebuyers and homeowners
looking for the opportunity to finance the purchase(or refinance) of a
house and the cost of its rehabilitation through a single mortgage or to
finance the rehabilitation of their existing home.
If you are looking for information on the 2009 Stimulus Bill
concerning tax breaks and/or tax credits for installing solar panels,
solar water heaters, geothermal heaters, fuel cells, windows, HVAC,
biomass stoves, insulation, roofs, small wind energy systems and more
the
Energystar.gov website has all the information you will need.
Construction cost are estimated by an FHA
approved 203(k) consultant (estimator). The consultant
assists you in determining the scope of repairs and the
costs budgeted for the renovation job.
Going Green with the 203K FHA Loan
What other reasons do you need, cost of energy is upon us. Today's world
is changing at a dramatic pace. Skyrocketing energy prices and a planet
showing years of abuse have led many to consider the way they live and
how to change their lifestyle.
The easiest way to reduce our
energy consumption and to help preserve the planet for our children and
grandchildren is to start at home. The place where we spend the most
time, where we consume the most energy and our biggest asset all in one.
Our homes are responsible for huge outlays of money and responsible for
preserving and creating wealth for our families. Now is the
time to do your part, take advantage of the incredible
tax and utility company credits, increase the value of your home and
prepare yourself for energy price increases by financing your energy
saving improvements with FHA 203K renovation financing.
Turn Key
inspections will provide all phases of a 203k loan, termite, lead, mold
testing, water, well certifications and many more
FHA 203K renovation loans have been around for decades, but they have
recently found a new use in helping people go green.
How do they work? The process is simple really, one loan closing with money to purchase
the property or to payoff current debt and an escrow account for
repairs. Loans $35,000 and above are facilitated with the aid of a HUD
approved consultant designed to help administer contractor draws and
insure repairs are done to FHA specifications. Loans $35,000 and under don't
require a consultant and repairs can be done by the borrowers chosen
contractor or, in some cases, the borrower themselves.
FHA awards
benefits in terms of higher allowable debt to income ratios along with
loan amounts that can exceed FHA statutory limits. So, how can you use
the FHA 203K to go green?
- Green Up Your Appliances - FHA 203K loans will finance new free
standing appliances for your home. Why not use that opportunity to buy
EPA recommended ENERGY STAR appliances? Imagine beautiful stainless
appliances that save you a bundle in monthly energy costs.
- Save Water, Save Energy - You can finance brand new low flow
toilets as well as
tankless water heaters. Low flow toilets use less
than half the water that older models do and tankless waters provide
unlimited hot water without all the wasted energy of a constantly
working water heater.
- Want New Hardwoods? - Opt for sustainable bamboo flooring. Bamboo
reproduces itself to maturity in 5 years as opposed to the 50-200
years than normal hardwoods take. Make sure and
opt for formaldehyde free glues.
- Environmentally Friendly Landscaping and Lawn - Making an
eco-friendly outdoor area that saves water and provides shade, helping
you reduce heating and cooling costs, is not as hard as you think. How
do we you do it? First of all choose local plants that require less
water and less pruning. Pruning creates waste and fills landfills, avoid
it if possible. Choosing local plants can help you conserve water and
require less work. If you have an irrigation system install a "smart"
system that calibrates water needed based on local climates and plant
needs.
- Solar Panels - Solar is one of the easiest ways to dramatically cut
monthly energy bills. Installing solar panels is so encouraged by HUD
that they will allow you to exceed statutory loan limits to do so.
In many cases the Federal, State and Utility company tax credits will
pay for a good portion of the purchase and installment of solar panels.
The rest can be financed.
- Better Insulation - The obvious choice for a green home, insulating
your home better can help you save thousands on energy bills.
- Choosing Green Building Materials - A key aspect of any green FHA
203K renovation is the selection of environmentally friendly building
materials. To reduce transport pollution and energy costs go local
first. The second thing to look for is recyclable materials such as
Glass, Terrazzo, Ceramic and Porcelain.
These are just a few of the myriad of green renovation choices you can
finance with an FHA 203K renovation loan. There are literally hundreds
of other ways to green your home, save yourself hundreds in monthly
energy costs, increase your resale value and do your part in preserving
the planet.
The time is now to take action and do what you can. You
never know, you might just be able to dramatically cut your monthly
energy bills, create a bundle in home equity and substantially improve
the marketability of your home.