If you want to finance the purchase of a home that needs rehabilitation or finance improvements to your current home, the Federal Housing Administration’s (FHA) Section 203(k) Rehabilitation Mortgage Insurance Program (203(k) Program) may be the right choice for you. This program is available through FHA-approved lenders and allows homebuyers to finance the purchase of a home or homeowners to refinance a current mortgage, combining the cost of renovations, repairs, or remodeling into a single loan.
The program permits homebuyers and homeowners to have home repair improvements incorporated into their mortgage. This way you can quickly and easily tap into cash to pay for property repairs or improvements, such as those identified by a home inspector or an FHA appraiser. Those who are buying a home can make it move-in ready by remodeling the kitchen, painting the interior, or purchasing new carpet. Homeowners can make property repairs, improvements, or prepare their home for sale. The 203(k) Program is also often used to rebuild or repair after a natural disaster such as a flood or hurricane. It is also available to HUD-approved non-profit organizations and government agencies.