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can you buy a bank owned home with an FHA loan?

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May 17 2010 - Indianapolis
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The answer really is "it depends."  Typically you can buy a bank owned home with a FHA loan.  But it really depends on the lender and whether or not they are willing to work with FHA or not.  As some of the other professionals have mentioned the condition of the home also determines whether a home can qualify for FHA financing.  Even though FHA guidelines have loosened over the last few years they still look for major safety issues and critical maintenance issues of the home.  If you are looking for a home that has major repair issues there are other financing options out there such as a 203K loan.  There is typically a little bit more paperwork involved with all Bank owned homes and then a little bit more with FHA financing but that typically is not issue.
Hope this helps. 
Good Luck!   
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May 17 2010
Yes you can the only catch to that is the house has to be up to FHA standards.  You can always ask your lender  or agent what those are so you can look for a home that qualifies.
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December 31 2010
In the past, most buyers had a hard time getting financed on bank homes that needed a lot of major repairs.  The best possible scenario is a FHA 203k loan.  A 3.5% down payment is still required.  The process has been refined into one department at Stonegate Mortgage.  They do 203k loans everyday, week after week.  The process still takes up to 60 days to close but is handled by a team that specializes in the process. 

Here is a link to their application page: http://www.stonegatemtg.com/apply.aspx?CampaignID=355
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December 30 2010
If the home is able to pass FHA qualifications, then yes.  Your agent and loan officer can help guide you in that process.  There are also 203 loans available for homes that do not pass FHA standards, to bring them up to FHA standards on top of updating.    You will need a good loan officer to work on 203 loans, as they are more detailed than a regular FHA loan.

Also, some banks want to quickly get rid of properties and not deal with rehab/203 loans, and so it also depends on the bank that is selling the property as to if FHA will be okay. 

It is worth a shot!
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May 24 2010
Absolutely. In fact, if the home is a "Home Path" home, you may qualify for a more favorable interest rate and generous help with closing costs.
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May 17 2010
Yes, you definitely can.  There is more paperwork for you to sign and there are FHA requirements that may come up in the appraisal period, but you can definitely buy a bank owned property with FHA financing.  that is unless the house is so damaged a person cannot get financing on it.  Rot, bad roof, etc. 
Good luck!
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May 17 2010
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Jessica,

The short answer is yes, but the property must pass the FHA inspection...

Hope this helps...
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May 17 2010
 
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