FHA 203k(s) – “Streamline” 203k Program

Are you looking at properties that need a kitchen in order to close? Or flooring?  Or reinstallation of the copper piping?  Or a new roof?  Need to mitigate a former meth house? We offer the FHA 203k(s).  This is HUD’s “streamline” 203k program, that allows the borrower to finance up to $31,000 into their purchase loan at closing to repair, restore and remodel homes.

Although the program is nowhere near as restrictive or cumbersome as the full 203k, there are some limits–the funds cannot be used to add a porch or other structure, including additional rooms or square footage and cannot be used for structural or foundation repairs; however, they can be used to finish a basement, replace windows, install new appliances, remodel a kitchen and/or bath, paint, carpet, westernization, etc..

Given the current condition of many of the HUD and REO properties, this may be the answer for many buyers who want to take advantage of bargain purchase prices but who lack the funds to repair the home to habitability or remodel it to their desires.  Rates are about the same as a non-203k(s), but you do need to add a week or two to the process to allow for contractors to submit bids (yes, the borrower must use a general contractor [which includes Home Depot or Lowe's!]). Work must be completed within 90 days and no funds are disbursed to the borrower, funds are paid to the general contractor and suppliers.