Rehab Loans #homebuyer #homeloans #fhaloan #interestrates #firsttimehomebuyer #rehabbinghouses

On a rehab loan, you have to get the offer accepted in a contract on the house in its current state, plus a contractor's bid for the repairs or rehab work needed. Then, to figure out your down payment, you combine those amounts. So let's say it's $150,000 house today, $50,000 worth of work needed. That's 200 grand in total. Let's say you're putting 5% down. That'd be a $10,000 down payment. Now, it's important to note that it has to be a licensed contractor. You can't do your own work. Rehab loans are a little riskier, so the entire market has a little bit higher interest rates for that. And I would say the typical buyer, casual homeowner, they think about a rehab loan, I would say maybe 1 out of 100 or 200 actually go through with it. Once they see that it's more expensive, it takes longer, more paperwork, a little bit tougher process. They just go get the move in ready. Property generally. But I think like the tried and true real estate investor, they know what they're diving into, they know what's going to, you know what it's going to entail, and they go through with the rehab loans generally. But that's just our two cents.