New to Real Estate · Brooklyn, NY · Member since 2020 · 69 posts · 30 votes
I'm a new investor and I have a question about FHA loans. Let's say for example, If you purchase a rental property for $250k, but get an approval letter for $300k. Can the extra loan amount be used for rehab purposes? How does that work?
Real Estate Agent · Salt Lake City, UT · Member since 2015 · 183 posts · 159 votes
6y
Great question, but unfortunately not. They will only lend on the appraised value of the specific property you are looking to buy. If you want to include rehab costs then you can still go through FHA, but it's called a 203k loan. There is a lot of paperwork and appraisals that go into it, but depending on your situation it can be a great option. Let me know if you have any other questions, good luck!!