FHA 203K “Rehab” Loans
This loan is backed by the federal government and helps buyers with with financing the purchase of a home along with the cost of the needed comprehensive repairs. The FHA 203K loan also allows current homeowners to refinance an existing mortgage for the home’s rehabilitation. These loans protect the lenders with insured loans and also save the borrowers time and money.
Benefits – FHA 203K Loans
- Designed to help borrowers finance an older home that needs significant repairs.
- Allows a borrower to finance amounts up to $35,000 for non-structural repair, such as painting and replacing cabinets or fixtures.
- Loan amount is not based on the current appraised value, but on the projected value after the repairs have been completed.
- FHA 203K will cover the repairs of : Decks, patios, bathrooms, kitchens, flooring, plumbing, siding, heating & air conditioning systems, and additions to home as in a second floor.
Requirements – FHA 203K Loans
- The projected cost of repairs on the home must be at least $5,000 to qualify and the home needs to be at least one year old. The rehab can range from minor to complete reconstruction.
- The value of the property must be within the FHA mortgage limits specific to the location.
- You will need to provide a proposal with details of the work you want to do.
- You must work with an FHA-approved lender to get an FHA-203k loan.
- Qualifying homes include: One to four family homes that are at least a year old, homes that has been torn down, provided that some of the existing foundation is still in place, homes cannot be a co-op, but some condos are eligible, and homes that you want to move to a new location.
Get Started! Complete the form below to see if you qualify for this program.