I am looking at buying a short sale in Overland Park. The problem is I want to borrow more than what I'm paying for the home and my real estate agent and mortgage lender say that is impossible. They said I would have to get a separate home improvement loan. Is this correct?

Question: I am looking at buying a short sale in Overland Park. The problem is I want to borrow more than what I'm paying for the home and my real estate agent and mortgage lender say that is impossible. They said I would have to get a separate home improvement loan. Is this correct?
–Jackie from Overland Park, Kansas

Answer: Not sure about the particulars of your financing and contract, but I I have had several homebuyers get a FHA 203K home loan. This loan allows the borrower to borrow over the purchase price to complete repairs/renovations. It will depend on the projected improved appraisal amount. With a FHA 203K home loan a borrower can not do the renovations/repairs themselves. They must be completed by a licensed/bonded contractor. The lender will require a copy of the contract up front between the borrower and the contractor doing the work to show amount of cost and what it is that will be done. The contractor gets paid as the items get finished, not ahead of time…so they need to be aware of that also. These types of loans only allow for certain types of repairs/renovations, so you will need to talk to the lenders that do these types of loans to see if the work you want to do fall within those perameters.


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