Loan Modification

FHA finances dog houses?!

By Gina Pogol

Okay, I’ll admit that I am watching Monday night football while writing this post, but I have only had one beer. And it’s true; if you want to build Rex a doggy dream palace (or a proverbial hideout for errant husbands), you can. Smaller projects come under the auspices of FHA’s Title 1 financing, and loans under $7,500 don’t even require a lien against your property. Loans on single family homes may be used for alterations, repairs and for site improvements. And, per FHA, “The Title I program insures loans to finance the light or moderate rehabilitation of properties, as well as the construction of nonresidential buildings on the property.“

You can apply at any lender (bank, mortgage company, savings and loan association, credit union) that is approved to make Title I loans. Many FHA lenders offer this loan. What are the interest rates like? A little higher than real estate loans, more in line with personal loans (remember that loans in smaller amounts don’t require a lien against the property). I did a quick search online and found that Title 1 rates run between 8% and 11%, depending on the loan’s term. You may be able to do better by requesting a quote from lenders on this site.

Full post as published by FHA Mortgage Guide on September 21, 2010 (boomark / email).