Mixed Use, converting commercial to residential - 203k

[Nicksino999]

I am eying a Mixed-use property. The commercial space is around 55% - 45% residential which doesn't qualify for FHA mixed-use. It will need a 203k and was wondering how it works if my intentions with the 203k would be adding some residential additions like a garden apartment or laundry area to satisfy 51% residential square footage. It appears FHA leaves this to the appraiser in some regards so just learning the process and if its allowable for alterations on a 203k to make the property eligible for FHA.

Thank you

 

[J Grant]

I am eying a Mixed-use property. The commercial space is around 55% - 45% residential which doesn't qualify for FHA mixed-use. It will need a 203k and was wondering how it works if my intentions with the 203k would be adding some residential additions like a garden apartment or laundry area to satisfy 51% residential square footage. It appears FHA leaves this to the appraiser in some regards so just learning the process and if its allowable for alterations on a 203k to make the property eligible for FHA.

Thank you

You would be better off asking a mortgage lender this rather than an appraiser.

FHA, I believe 51% of the property has to be residential. Whether adding additional res use using 203k qualifies the property. idk. Usually, the property is already over 50% residential, and then the 203k is repair or upgrade

Does the 203k program cover additional and expanding property? Idk. Also, is the zoning mixed-use, or is it strictly commercial? The mortgage lender might not know the answer because this is an unusual idea; they might want to submit it to a HUD/FHA as a question and get the official answer.

 

[Nicksino999]

Thanks J Grant. My understanding is the appraiser will determine square footage of property and what it can be used for. Ill reach out to a lender or HUD.