A 203k loan is a loan program that is offered to clients for the rehabilitation and repair of individual’s properties. It is also the streamline repair program not to be confused with FHA’s much more complicated 203K program, a Streamlined 203K loan eliminates much of the paperwork and simplifies the process to obtain rehab funds.
An FHA 203k loan is a home improvement loan available through the FHA. An individual can finance the renovation of a primary residence for purchase or refinance. Improvements allowable through the FHA 203k program include:
- New bathrooms
- New Kitchens
- Roofing and Siding
- New Furnace or central air conditioning
The FHA 203k loan allows financing up to 96.5% of the value of the property after the improvements have been completed. The program does not allow ground up construction or finishing a construction project on a house that never has never had a certificate of occupancy.