June 9, 2011
The Federal Housing Administration’s (FHA) 203k Rehabilitation Loan or “Streamline K” is an easy to use mortgage program specifically designed for those who wish to make improvements on a home they own, or would like to buy.
Rather than having to obtain a separate loan to finance the cost of repairs (or walking away from a home you love because you don’t have the cash for home improvements), the Streamline 203K rehabilitation loan allows you to finance these costs — up to $35,000 — within your FHA mortgage or refinance itself.
What Home Improvements Can I Make with a 203K Loan?
A Streamline 203k loan allows for a wide variety of home improvements to be performed on a home. It’s intended for simple repairs, light remodeling, and upgrades (including money saving energy efficient upgrades).
There is NO MINIMUM amount you must borrow. Therefore, your 203K rehabilitation loan can refinance as little as $1 and as much as $35,000 worth of improvements. It’s up to you.
Here are just a few of the improvements you can perform with the Streamline K:
- Repair, replace, and upgrade roofs, gutters, downspouts
- HVAC systems (heating, vacuum, and AC)
- Plumbing and electrical systems
- Flooring, exterior decks, patios, and porches
- Minor remodeling
that does not involve structural repairs (ie. kitchen, bathroom or basement)
- Interior and exterior painting
- Weatherization, including doors, windows, insulation, stripping, etc
- Appliance purchase & installation (ie. kitchen appliances, washer, dryer)
- Energy efficient upgrades
- Lead-based paint removal & stabilization
- Exterior wall re-siding
- And more!
Are your intended projects on this list? An FHA 203K loan may be just what you need!
How does a 203k Loan Work?
The beauty of the Streamline K is its simplicity.
When you take the loan out, the money is put into an escrow account and the contractors hired to do the repairs are paid up to 50% of the cost up front. When they finish the work — like with any manner of construction — they are paid the balance.
Work financed through a 203k loan must be started within 1 month of closing, completed within 6 months, and may not require architectural plans.
How Can I Apply for a 203K Purchase or Refinance Loan?
Whether you certain the 203K loan is right for you, or you’d like to know if your intended improvements are eligible, CREFCO’s 203K loan experts can offer you fast, free information, rates, and guidance.
Give us a call at 1-866-854-4242