How much money do you need when trying to get FHA203 Pre-approved

[Joshua R.]

I am in the process of purchasing my first investment property. I am setting up meetings with a few different FHA Consultants to discuss pre-approval for an FHA 203(k) streamline. The loan is for 200,000.00. How much money should be available when trying to get pre-approved? Should I have just the down payment ready, or the down payment+closing costs, or a certain percentage of the entire loan? Please any insight or experiences that can shed some light to this question will be greatly appreciated. Thank you in advance!

[Aaron Montague]

@Joshua R.

Also check with your county and city for incentive programs.  I've seen a few folks buying in larger cities with variations on the word subsidy.  I don't know what they involve, but there may be thousands of dollars available for various reasons.  Check those out as well.

So the math as I see it:

203k Down Payment on 200k (3.5%): 7k

Taxes 1 year(~2%): 4k

Insurance??: $1500

Origination Fee (Make sure you ask about this while you are shopping banks): $1000

Lawyer: $1000

Inspection: $400

Appraisal: $600

Total: $15,500

You may be able to roll Taxes and Insurance into a 203k loan.  Check into that with both your Loan Officer and personally.  So you might get away with only bringing ~10k to the closing table in the above scenario.