Does anyone know how the interest rate on a fha rehab loan works?
Hello – I am insterested in buying a property that requires about 15,000-20,000 worth of work. Thing such as new carpeting, panting, a piece of siding needs to be fixed, vinyl flooring needs to be fixed etc. I know that you can roll this into your monthly mortgage payment, but how does the interest work? Is it higher or lower then the normal interset rate that you would pay if you were doing just a straight fha loan? Does it get calculted seperately under a different interest rate and then added on to your monthly mortgage payment? I am trying to figure all this out before I decide what to offer on a particular property and my lender isn’t open on a Sunday. I want to know how high I can go with my offer, since I am starting out low, I know the bank will come back and want more. Any advice on how the interest works on this would be great!.
Also does the rehab loan cover fencing?