What is an FHA 203k loan? An FHA 203k loan (sometimes calle..
Added 2021-10-18 00:10:06 +0000 UTCWhat is an FHA 203k loan?
An FHA 203k loan (sometimes called a Rehab Loan or FHA Construction Loan) allows you to finance not one, but two major items:
The house itself
Needed/wanted repairs
This loan addresses a common problem when buying a fixer home: lenders often won’t approve loans for homes in need of major repairs.
Because the lender tracks and verifies repairs when using a 203k loan, it is willing to approve a loan on a home it wouldn’t otherwise consider.
That said, for a lender to approve financing, the home must already meeet certain safety and livability standards.
If the home is too run down, you won’t be able to use an FHA 203k rehab loan.
This program can be a good option for people on a tighter budget, who want to buy an older or run-down home and repair it rather than buying a more expensive turn-key home.
