203K loans in Historic Districts - Are they typically difficult to get? (loan, approved)

[abetterroanoke]

I'm looking at purchasing a historic home that needs a full rehab (the interior has been demo-ed down to the studs).

I called one mortgage company in the city I live in (that according to the HUD website specializes in 203k loans) and they told me that since the home was in a historic district, and because you have to abide by so many rules and regulations when renovating in a historic district, they weren't interested in pursuing the loan.

Is not wanting to loan money to renovate houses in historic districts typical of 203k lenders? That just seems weird to me. In the city I live in, you simply have to apply for a "Certificate of Appropriateness" with the local Architectural Review Board, and if you're approved, you can begin your renovations.

Also, has anyone ever been able to get a construction loan to renovate an old home that needs extensive renovations instead of using a 203k?

[chet everett]

You should have no additional scrutiny from the lender becuase of the inclusions of being in an area that require s "architectural review" -- thousands and thousand of HOAs have similar process and contractors understand that such review basically means you just need to use a little nicer grade of exterior finishes. Instead of using low end vinyl windows or some kind of fake exterior your contractors will need to use actual clapboards or real stone / brick.

In all honesty the standards and costs most lenders have for construction / renovation loans is MUCH more restrictive and costly than what the FHA requires for 203k loans. You can save a lot of money by going with a 203k, and you have a built-in review process that helps to ensure you get value for the work done.

I would also recommend that you contact the municipality as many that have historic districts do special laon programs with local lenders to make it easier for reidemts and buyers to enhance the value of historic homes. Even if they do not have a specific program set up they might be able to put you in contact with home owners that can tell you what lenders were easier to work with. There are still some lazy and cowardly lenders that shy awe from any deals that require anything beyond the minimums...

[Metro Mitch]

I am working on a historic home in downtown Durham, NC. Let me tell you it has taken almost 6 months to do a job that would generally take about 2 months anywhere else. The permit process and historic socity are slow moving and everything has to be approved paint, brick, floorplan, interior coating, etc. Make sure you can afford two mortgages for an extended period before you attempt doing a 203K in a historic district. On a full 203K you can finance up to 6 months of payments into the loan which will give you the time you will need to get the project completed. You can try Wells Fargo they are the ones who funded this loan with a 203K. There are also conventional rehab loans you can explore as well. Make sure you use a mortgage company that knows what they are doing and a contractor that has done 203K rehabs before.