If you have been shopping for homes recently, you may have noticed that there are quite a few properties that are in need of at least a few minor repairs on the market.
And if you are wondering what kind of loan programs are available for a home that is in need of repairs, chances are that someone has brought up the FHA 203k loan program.
The FHA 203k loan program is designed to help homeowners buy a home that is in need of a few repairs and get them money for repairs that can be rolled into the loan. And when it comes to the types of repairs that are the most common — think about stuff like kitchen and bathroom remodel stuff, not 10,000 luxury iron front doors because the FHA 203k loan program doesn’t allow for “luxury items”.
In order to qualify for the FHA 203k loan program, the improvement has to be permanent to the home and a basic improvement such as an additional room, a deck, drywall work or painting. There are quite a few items that are allowed in the FHA 203k program, but here is a simple list of the most common items that homeowners choose to improve:
- Kitchen remodel
- Bathoom remodel
- Repairing damage done by termites
- New exterior work (stucco)
- Plumbing upgrades or replacement
- New flooring
- Roofing improvements
- Installation of new smoke detectors
- Major landscape improvements
- Energy conservation improvements such as new windows and new insulated doors
If you have found a home that you really like, but it is in need of repair – with the FHA 203k loan program, you can truly finance your home AND the cost of repairs if approved. And when you work with your loan officer, you can learn more about the FHA 203k streamline and the FHA 203k full loan. There is a difference between the two – and depending on how many repairs are needed on the home, that will determine which 203k loan program will be best.
The FHA 203k streamline program is designed for simple improvements that can be done with minimal work and no structural changes to the structure. Some of the most FHA 203k loan improvements include:
- Repair gutters and downspouts
- Repair/upgrade of existing HVAC systems
- Minor repairs of plumbing and electrical systems
- Minor repairs of existing flooring
- Minor remodeling that does not involve structural repairs
- Exterior and interior painting
- New appliances – which may include free-standing ranges, refrigerators, washers/dryers, dishwashers and microwaves but may not exceed $2,000
- Improvements for accessibility for people with disabilities
If you have more questions about the FHA 203k loan or the FHA 203k streamline loan, you will want to speak to a loan officer who is an expert in these areas — there are far too many ins-and-outs that you need to know when applying for a FHA 203k loan to know them all yourself.
Work with an FHA 203k expert loan officer today!
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