FHA Rehab Loan 203k

There are lots of foreclosed homes that need more than just a little love.  They need work to be livable.  The standard FHA loan requires the property be livable, no broken windows, appliances in place, no bare cement floor etc. The FHA 203k loan allows for someone who has fallen in love with a house that needs work to still get a loan using the FHA guidelines. The FHA 203k loan is not new.  Some of the qualifications for it have changed making it easier to obtain today than in years past.  The 203k loan is part construction loan and part FHA.  It is designed to help with the purchase of a home that may need repairs or remodeling.  Here are a few improvements allowed.

  • room or garage additions
  • kitchen or bathroom remodels
  • roofing and landscaping
  • pool repair (up to $1500)
  • electrical upgrades

The cost of repairs are rolled into the loan amount, and the home is appraised as if the repairs have been complete.   The 203k allows for up to $35,000 in repairs with a min of $5,000 to qualify.  The total loan value including repairs can not exceed the FHA limit (346,250 in Maricopa County till the end of this year)

The Federal Housing Administration (FHA) is a division of the Department of Housing and Urban Development (HUD).  HUD was created to make affordable financing readily available to qualified buyers. Also check out HUD’s info on the 203k as well as the FHA site on the 203k.

A big thank you to Robyn Robertson for her sharing this with me.

Comments

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