What is a 203k Loan?
FHA’s 203k loan program is designed to provide funds for the purchase and renovation of your home all in one loan. With the FHA 203K loan, you can easily access cash to pay for property repairs or improvements. Once the purchase of the home is closed, renovation funds are held in escrow to pay for pre-determined renovations. AFI Financial has FHA 203k loan specialists that can answer all of your questions. FHA Loan limits vary by market. To check the current loan limits by county, go to entp.hud.gov or check with an AFI Financial loan specialist for the current limits.
FHA 203k loans are available in two types:
- The Standard 203k is intended for more complicated projects that involve structural changes, such as room additions, exterior grading and landscaping, or renovation that would prohibit you from occupying the residence. A Standard 203k is also used if your project requires engineering or architectural drawings and inspections.
- The Streamlined 203k is designed for less extensive improvements and for projects that will not exceed a total of $35,000 in renovation and related expenses. This version does not require the use of a consultant, architect, and engineer or as many inspections as the Standard 203k. As a result, when applicable, the Streamlined 203k generally becomes the simpler, less costly option.
Contact us to learn more about what improvements are eligible under the Streamlined 203k.
Is a 203k Loan Right for You?
- Buy a “Fixer-upper” or REO property needing renovation
- Get funds to both purchase and upgrade your dream home
- Refinance and renovate your existing home
Advantages of a 203k Loan
- Loan amount based on the home value including renovations
- Only one loan needed to both purchase and improve
- Refinance and rehab your own home
- Can be used to buy property otherwise not eligible for financing
- A minimum down payment of 3.5%*
- A credit score of 640 or higher
- You currently have no other FHA loans
- You DO NOT have to be a first-time buyer
HomePath Mortgage allows a buyer to purchase a Fannie Mae-owned property with a low down payment, flexible mortgage terms, no lender-requested appraisal and no mortgage insurance. Expanded seller contributions to closing costs are allowed.
HomePath Renovation Mortgage
HomePath Renovation Mortgage allows a buyer to purchase a property that requires light to moderate renovation. The loan amount includes funds for both the purchase and renovation — up to 35% of the as completed value, no more than $35,000.
If you’re looking to buy a HomePath home, whether you’re buying your first home or your fifth, the experience can be exciting, confusing, overwhelming and wonderful — all at once! Buying a Fannie Mae-owned home isn’t much different. And to help you through the process, we’ve got handy tools and resources available.
HomePath Buyer’s Guide for a Fannie Mae-owned Home
This Buyer’s Guide — while it doesn’t cover everything — should better prepare you when considering and purchasing a Fannie Mae home.
Fraud Awareness and Prevention
Fannie Mae is committed to preventing mortgage fraud, including REO Sale and Short Sale fraud, whether perpetrated by borrowers, purchasers, real estate professionals or any other parties involved in real estate transactions. Fannie Mae is at the forefront of developing tools and deterrents designed to prevent mortgage fraud, and we partner with law enforcement agencies in their efforts to detect and prosecute fraud.
Not sure how much home you can afford? Use the mortgage calculators to estimate your potential monthly payments and determine what’s affordable within your budget.
Information is provided by HomePath.com