What Is a 203k Mortgage?

What Is a 203k Mortgage?
Couple kissing in front of a newly bought house.

Streamlined 203(k) Loans Cover Minor Repairs

Homes in need of minor, cosmetic repairs may qualify for up to a $35,000 loan amount through the 203(k) streamlined program. FHA lenders require less oversight of the repair work in a streamlined renovation. You can use it to make a purchased property move-in ready or prepare your home for sale. Common repairs include interior painting, re-flooring and kitchen and bathroom remodels.

Regular 203(k) Is Used for Remodeling

A regular 203(k) loan is for bigger projects, such as fixing a damaged foundation, adding a room, obtaining building permits, plumbing, roofing, or finishing a room or attic. Used for purchasing or refinancing a fixer-upper, a regular 203(k) loan covers third-party labor and materials. Your lender may require multiple bids from contractors before approving the loan and may also require inspections before approving payment for completed jobs.