203k rehabilitation loans

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HUD-FHA insures rehabilitation loans for owner-occupants, municipalities and non-profit housing providers to (1) finance rehabilitation of an existing property; (2) finance rehabilitation and refinancing of the outstanding indebtedness of a property; and (3) finance purchase and rehabilitation of a property.

203(k) can be used with 1-4 family dwellings, condominiums and HUD Homes that require a minimum of $5,000 in repairs. CO-OPS ARE NOT ELIGIBLE. Garden apartment style row housing can be converted with 203(k) to fee simple or condominium with the addition of fire walls every 4 units. 203(k) can be used to bring illegal dwellings into code compliance. Mixed use residential/commercial properties are eligible. A burnt out shell, incomplete shell or empty foundation is eligible for 203(k) financing provided it is over 1 year old. 203(k) can be used by non-profit and local government community development corporations to rehabilitate and sell or rent foreclosed 1-4 family properties and condominiums.

203(k) CAN NOT BE USED BY INVESTORS.

203(k) can be combined with grants, section 108 loans, downpayment assistance programs, bridge financing, Title I Home Improvement Loans, Energy Efficient Mortgages (EEM), Loans and Multifamily SPP mortgages in garden apartment style buildings. 203(k) is the mortgage instrument of choice for local governments seeking to aquire and repair foreclosed properties for their affordable housing programs.