October 1, 2010
October 2010 - Leading mortgage lender New Penn Financial, LLC has launched a new funding division to aid homebuyers interested in homes in need of repair, which are often discount priced. By offering the Federal Housing Administration's 203(k) loan, New Penn enables individuals to unlock opportunities in the rehab market that may have been inaccessible with a conventional bank mortgage.Rehab financing usually requires a multi-step, high-interest process of acquisition loan and construction loan, which are then folded into a permanent mortgage. That's why rehab projects are usually the province of professional real estate investors who have the means to buy properties with cash and avoid the bank mortgage process.
As an approved FHA lender, New Penn helps ordinary consumers participate in rehab opportunities, including those who have relatively low credit scores, income, or limited cash. The 203(k) program provides a single mortgage for purchase and rehab, factoring in the "as-is" value of a property plus rehabilitation costs. It can be used for a wide range of renovation needs such as kitchen and bathroom remodels; basement finishing; roofing; flooring, decks and patios; and energy efficiency improvements.
The FHA considers its loan "an important tool for community and neighborhood revitalization and for expanding homeownership opportunities."
"We are excited to add the FHA 203(k) loan to our suite of products," said Jerry Schiano, President and CEO of New Penn Financial. "Many consumers have had to pass up homes that require cosmetic repairs for lack of available funds. This loan opens doors."
"In addition to fitting well with our strategy and mission to become one of the nation's top lenders, the loan enhances our consumer-focused approach," said Schiano. He added, "We are open for business and can assist consumers immediately."