FHA Streamline 203k Renovation Loan

Prices of new construction and newer existing homes have been going up fast over the last several years and first time home buyers may want to consider buying a fixer upper. The FHA Streamline 203k Renovation Loan allows you to finance up to $30,000 repairs and remodeling costs into the mortgage.

I wish I knew about the 203k FHA loan when I bought my first house. My wife and I bought a charming Victorian which was 115 years old and it needed new siding, roofing, and windows and the cost was $25,000. Have you seen the movie the "Money Pit"? We had to use credit cards and all our savings to pay for the repairs because we did not know about the 203k rehabilitation loan. The good news is that my wife and I sold the home 2 years later and made over $100,000 profit and we were able to pay off the credit cards which brings up a good point. Even though we used higher interest rate credit cards to renovate our home, we still made a huge profit on it because we bought it at below market value because it wasn't in great shape and once we renovated it, the value skyrocketed. The Renovation loan is great for first time buyers who want to buy a nice starter home and don't want to use their savings and credit cards to fix it up.             

Some Advantages of FHA 203k Renovation Loan are:

• Must have minimum $5,000 repairs and remodeling costs and the maximum renovations are $30,000.
• Loans can go up to 110% of the after-improved appraised value!
• There is no 203(k) consultant involved. Repairs are usually based on contractor bids.
• Down Payment Assistance is allowed and the seller can pay up to 6% of the purchase price in closing costs which means you may be able to buy a home and fix it up with no money out of your pocket!

Use your Streamline loan to make any of these repairs:

• Remodel-update bathroom and kitchen
• Repair-replace floors
• Upgrade roof, gutters, and downspouts
• Fix existing HVAC systems
• Update plumbing and electrical systems
• Paint-interior and exterior
• Weatherization-insulation, weather stripping, etc.
• Replacement Windows and Doors
• Upgrade appliances which may include ranges, refrigerators, washers/dryers, dishwashers, and microwaves.
• Rehab-replace decks, patios, and porches
• Basement finishing, remodeling, waterproofing which does not require structural repairs.
• Improve accessibility for disabled persons

Back to Top