The Capital Area Finance Authority is getting the word out about two Federal Housing Administration loan programs that are available to help people who are looking to buy or remodel a home after last month’s flooding.
The FHA 203h Purchase Loans and the FHA 203k Renovation Loans programs allow people to borrow up to $271,050 to buy or remodel a home if their previous residence was located in a federal disaster area or was damaged by flooding.
“So if you were living in an apartment complex that was destroyed by the flooding, you now qualify for an FHA disaster loan,” said Mike Airhart, executive director of the CAFA.
Potential homeowners have up until one year after a disaster declaration to participate in a loan program. The purchase loan covers all costs associated with buying a home, while the renovation loans offer combined financing for buying and renovating a flood-damaged house. There are two types of renovation loans: a limited loan that allows for up to $35,000 of renovations and a regular loan that allows for renovations above $35,000.
“We’ve heard of some homes in the Sherwood area selling for $55,000,” Airhart said. So this could allow someone to purchase and renovate a house.”
The FHA loans are available through 32 different local banks and lenders. A minimum credit score of 620 is required for the purchase loan.
CAFA is also offering a non-refundable 5 percent grant of the final loan amount to help with closing costs and down payment for a limited renovation loan.
The programs are designed to allow people to remain and rebuild in their communities that were affected by the flooding.