Section 203(k) FHA Insured Loans For Home Rehabilitation and Home Improvements

Section 203(k) mortgages allow you to purchase or refinance and rehabilitate a home at least 1 year old. A portion of the loan proceeds are used to pay off the existing mortgage, and the remaining funds are placed in an escrow account and released as rehabilitation is completed.

Everyone, who has a satisfactory credit record, enough cash to close the loan, and sufficient steady income to make monthly mortgage payments can be approved for a section 203(k) mortgage. The improvements financed with Section 203(k) mortgage proceeds must comply with HUD's Minimum Property Standards and all local codes and ordinances.

With an section 203(k) mortgage, you can make extra payments toward the principal when you make your regularly monthly payment. By making extra payments, you can repay the loan faster and save on interest. You can also pay off the entire balance of your FHA-insured mortgage at any time.

FHA loans cannot exceed the statutory limit.

To get a section 203(k) loan, you need to apply to a HUD-approved lender.

Rehab a Home with HUD's 203(k) Programs Detailed description and eligibility requirements.
203(k) Program Description
Q&As about 203(k)

For more information about a section 203(k) program and other HUD's programs please contact your local HUD office. Each state has at least one office.


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Section 203(k) FHA Loans