FHA 203(k) Basics

Renovation financing to turn your house into your dream home

 

What Is a 203(k) Loan?

The FHA 203(k) loan lets you purchase or refinance and rehabilitate a property with one loan closing. The projected rehabilitation costs are held in an escrow account and disbursed as work is completed and inspected. The loan amount is based on the lower of the projected market value following repairs or purchase price plus renovation costs.

 

Is a 203(K) Loan Right for You?

Buy a “Fixer-upper” or REO property needing renovation

Get funds to purchase AND upgrade to your dream home

Refinance and renovate your existing home

STREAMLINE 203(k) LOAN PROGRAM

The Streamline 203(k) allows homebuyers to finance up to an additional $35,000 for repairs and improvements into their mortgage. Homebuyers can quickly and easily tap into cash to pay for the work on their property, whether an appraiser requires it or not!


The following repairs can be financed with this program:

  • Repair/Replacement/Upgrade
    • Roofs, gutters and downspouts
    • HVAC systems
    • Plumbing and electrical systems
    • Flooring
    • Appliances
    • Well & septic
    • Windows & doors
  • Remodeling (w/ no structural concerns)
    • Kitchens
    • Bathrooms
    • Bedrooms
    • Basement
  • Additions
    • Solar panel installation
    • Exterior deck or patio
    • Swimming pools
  • Exterior and interior painting
  • Weatherization including storm windows and doors, insulation, weather stripping, etc.
  • Improvements for accessibility for persons with disabilities
  • Lead based paint stabilization or abatement of lead based paint hazards
  • Basement waterproofing

FULL 203(k) LOAN PROGRAM

The Full 203(k) permits homebuyers to finance an unlimited amount* for repairs and improvements into their mortgage. Homebuyers can quickly and easily tap into cash to pay for the work on their property, whether an appraiser requires it or not!

The extent of the rehabilitation covered by 203(k) loan may range from relatively minor ($5,000 to $25,000) to virtual major reconstruction ($25,000+). It can also cover the conversion of a property of any size to a one- to four- unit structure.

203(k) financing allows applicants to finance:

  • Structural alterations and major reconstruction
  • Modernization and cosmetic improvements
  • Landscaping and other site improvements
  • Energy efficient improvements

In addition to:

  • Repair/Replacement/Upgrade
    • Roofs, gutters and downspouts
    • HVAC systems
    • Plumbing and electrical systems
    • Flooring
    • Appliances
    • Well & septic
    • Windows & doors
  • Remodeling (w/ no structural concerns)
    • Kitchens
    • Bathrooms
    • Bedrooms
    • Basement
  • Additions
    • Solar panel installation
    • Exterior deck or patio
    • Swimming pools
  • Exterior and interior painting
  • Weatherization including storm windows and doors, insulation, weather stripping, etc.
  • Improvements for accessibility for persons with disabilities
  • Lead based paint stabilization or abatement of lead based paint hazards
  • Basement waterproofing


*The rehabilitation cost, although unlimited, cannot exceed the after improved value of the home including the sales price.