FHA 203(k) Mortgage
The FHA 203k program makes it easy for borrowers to purchase and remodel foreclosed and distressed properties, and for current homeowners to make improvements to their properties
FHA 203(k) Mortgage For Home Rehabilitation
IFHA 203(k) loans make it easy for borrowers to purchase and remodel homes, including foreclosed and distressed properties. Current homeowners can also use the program to make improvements to their properties.
How Does a 203(k) Mortgage Work?
Using the FHA 203(k) mortgage loan program, a qualified borrower can get one permanent fixed or adjustable rate mortgage to finance the purchase and rehabilitation of a house. One of the benefits of the program is that eligible borrowers can get the mortgage before doing their renovations.
Compare this to the traditional means of buying a home and getting a construction loan to renovate it: a borrower would need to get a mortgage from a lender for the value of the unimproved property, secure a second loan to cover the costs of the renovation, and then get a final, permanent mortgage that would pay off the initial loan and the construction loan after the renovations were complete.
In order to be eligible for the program, a borrower must be qualified under standard FHA underwriting guidelines. Additionally, the property must be owner-occupied and completed for at least a year. Multi-unit buildings up to 4 units are eligible for the program.