MARGATE — Fred Verna and his daughter, Kendall, have shown how the FHA’s 203(k) mortgage program can work for buyers and owners of storm-damaged homes along the shore.
In April, they used such a mortgage to buy a flood-damaged house in a desirable neighborhood near the back bay. Eight months later, it looks better than new and will become the home of Kendall and her fiancé after they marry in June.
“I love it. It’s really warm, cozy and very homey,” said Kendall Verna, who lives with her parents nearby in Margate.
The Federal Housing Administration’s 203(k) program offers guaranteed mortgages that provide funds not just to buy or refinance a property, but also rehabilitate it.
In the Vernas’ case, $250,000 was used to purchase the house and another $50,000 went toward the eventual cost of $58,000 to renovate it, Fred Verna said.
The Vernas were able to accomplish quite a bit for that money. Fred Verna chose Cristaldi Builders, of Margate, for the job after Michael Cristaldi had done exemplary work on his own home the year before.
After the Hurricane Sandy flooding, the prior owners tore out the kitchen and stripped the family room down to the studs.
Now there is a full-featured kitchen with spacious cabinets, new appliances and an island.
Fred Verna said the kitchen was designed by Kendall’s maternal grandmother, Rickey Archangelo, also of Margate, and all of the cabinetry and appliances were selected from Lowe’s. He said they watched for sales and specials, got great help from the home store, and created the whole kitchen for just $11,000.
“My grandmom did all of the designing and selection of furniture and lamps and decorative things,” Kendall Verna said. “She’s very good at what she does.”
Between the kitchen and family room, the Vernas created a half wall to keep the open feeling while defining the spaces.
Between the living and dining rooms, they took out a full wall, making the large open space that has become the preference in home design since the house was built.
Where the family room used to focus on a large wood-burning stove, now there is a gas fireplace. And the simple rear entry door into the room has been converted to a glass slider, ready for the deck Kendall and her husband may want to add some day.
The first floor closets all got new doors and storage kits within, 1,000 square feet of ceramic tile was installed, the staircase was repaired, and the living room got a refinished floor and crown molding.
“When you have that much already to tear apart, it doesn’t make sense to have to go back,” Fred Verna said.
He praised the mortgage professionals at what was then Acre Mortgage in Galloway Township for their expertise at FHA 203(k) mortgages and overseeing the loan process.
That office has since been bought out by a large national corporation, the Real Estate Mortgage Network, said Frank Montufar, of Absecon, who is now that company’s branch manager in the same location.
He said the local team with its 203(k) expertise is still there, only now it’s backed by “a whole REMN concierge desk dedicated to 203(k) lending in the country.”
Other FHA-authorized 203(k) originators in the region include Wells Fargo Bank in Linwood; American Neighborhood Mortgage Acceptance in Pleasantville; Guaranteed Rate Inc. in Hammonton and Little Egg Harbor Township; Gateway Funding Diversified Mortgage Services in Vineland; and Equity Loans in Manahawkin.
Last month, the Vernas refinanced out of their FHA 203(k) loan to lock in a 4.25 percent mortgage rate and eliminate the need to pay FHA-required insurance costing $310 a month, Fred Verna said.
“I give a lot of credit to my dad,” said Kendall Verna, 27. “Without him, we couldn’t have done this. And of course to my mom, who was so patient with my dad putting so much work into my house.”
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