FHA loans weren't very popular when 100% financing was easy to obtain, but now that you have to have more than a pulse to get a loan, they are on the rise again. Needing just 3.5% of the purchase price for a down payment, as opposed to 5,10, or 20%, is a big draw, as is the rehabilitation loan- called the 203(k) loan. With this option buyers can finance the cost of repairs, and then have a contractor perform them and get paid once they are complete. This is especially attractive to buyers who are interested in older homes that need big fixes, such a heating systems, roofs, and new flooring. The buyers have 6 months after closing to have the repairs finished. In 2008 only 6,700 203(k) loans were done, but so far in 2009 over 11,000 of them have been taken advantage of.
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