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The FHA 203(k) Improvement Loan

How to buy a home and make improvements all at once.
The Basics

An FHA 203(k) Loan Explained

FHA 203(K) mortgage loans are a good choice for buying a home that needs a little TLC. Simply put, these rehab loans finance both the home itself and any needed or wanted repairs you need to make as well. 

Repairs & Purchase

What FHA 203(k) Loans Cover

FHA 203(K) mortgage loans cover a variety of repairs and improvements, starting with any safety or health hazard issues, which the lender will require. From there, buyers can choose whatever cosmetic items they want replaced, from new kitchen counters and appliances to bathroom fixtures and flooring. 

The Finances

FHA 203(k) Loan Details

FHA 203(K) mortgage loans require borrowers to work a little more closely with their lender than a conventional mortgage, especially in the beginning. After you’re approved for a loan and figure out what repairs are needed, you’ll then need to get bids, choose a contractor, submit everything to the lender, close the loan, and navigate your way through the construction process. 

Work Preparation

Choosing a Contractor

Once you have an idea of what the home you’re planning to buy needs you’ll need to choose a contractor. Not surprisingly, the contractors must be licensed and insured, and it’s also recommended you choose a contractor who has done at least one 203K renovation previously. Extra 203K paperwork is common and you’ll want someone who is prepared to handle everything that goes along with this type of financing. 

Making a Decision

Is a 203(k) Loan Right For You?

Wondering if 203(K) financing is a good fit for your situation? If you’re open to the process or love a good project, rehab loans can be a great way to buy a home and put instant equity into it. 

FHA 203(k) Guidelines

A great place to get started, this is our quick overview of FHA 203(K) guidelines and what to expect throughout the entire process once you’re approved. 

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Common 203(k) FAQs

Still unclear on a few thing? We try to answer the most common questions home buyers have about FHA 203(K) financing here. 

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FHA 203(k) Eligibility

Wondering if you’re eligible for a 203(K) mortgage loan? There’s a good chance you are but learn more about eligibility requirements and securing your rehab loan below. 

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Hiring a Contractor

Tips for hiring the right contractor. Along with being licensed and insured, find out why it’s also beneficial to hire a contractor who has experience in dealing with 203(K) financing. 

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What You Can Fix or Repair

Safety and health hazard repairs are required but buyers will also get to choose all sorts of cosmetic upgrades as well, from new kitchens and bathrooms to even repairs to your garage. 

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203(k) Pros & Cons

The advantages and disadvantages of 203(K) financing. We lay it all out here in a simple pros and cons format. 

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Get Your Rate

Recent Trends

The interest rates you see here are an average of the published annual percentage rate with the lowest points from a sampling of major national lenders. Contact us about what your interest rate might look like or click below to learn more about how interest rates are calculated.

Considering FHA 203(K)?

Start your FHA 203(k) journey now. Getting the pre-approval process started only takes a couple minutes.

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