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FHA 203K Rehabilitation Loan
Loan Term:
30 / 25 / 20 / 15 / 10 years
Max Loan Amount:
loan amounts vary by county and state
Minimum Down:
roughly 3% of purchase price
Available for:
Owner-occupied primary residence, Condos, 1-4 unit properties (you must occupy one of the units)
Loan Features:
Fixed interest rate and monthly payments
Your monthly principal and interest payment will never change for the life of the loan. Get the peace of mind that you are protected from any future increases in interest rates.
Low down payments and flexible guidelines
FHA loans feature low down payments and flexible qualifying guidelines which make it easier to obtain your next home. FHA loans can qualify you for more home than the typical conventional loan. With FHA loans, there is no minimum credit score to qualify when you have acceptable credit. Best of all, 100% percent of your down payment can be a gift.
No need for a second mortgage
An FHA 203K loan combines mortgage and home repair/renovation costs into one low monthly mortgage payment.
Consider choosing this loan if:
You are purchasing a home and you are going to rehabilitate it. With the FHA 203K loan, you can purchase your property and rehab it, all with one low interest rate loan.
You worry you don't have enough money for a downpayment. With an FHA loan, your entire down payment can be a gift.
You are a first time home buyer or even a move-up buyer looking to qualify for more home than conventional programs will allow. FHA's credit and down payment guidelines are flexible to help get you into your next home.
To Proceed:
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Apply for this loan
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Speak with an experienced
professional about this loan.
Other
FHA home loans:
FHA 1 Year ARM
FHA 203K Rehabilitation Loan
FHA Fixed Rate Loan
(click on the loan to learn more about it)
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Learn more (key terms and concepts)
FHA Home Loans
FHA Home Loans feature low down payments and flexible guidelines to make it easier to qualify. FHA loans are popular with first time home buyers but they can be equally attractive to move-up buyers. FHA home loans are insured by the Federal Housing Administration (FHA), a division of Housing and Urban Development (HUD). HUD does not generally provide the funds for the mortgages, but they insure (see Mortgage Insurance) mortgage loans made by private industry lenders such as banks and mortgage bankers. HUD/FHA offers a variety of single family home loan programs including single family (1-4 unit homes) mortgage lending programs.
FHA Mortgage Insurance
Mortgage Insurance FHA mortgage loans include a Mortgage Insurance Premium (MIP). FHA home loans require mortgage insurance premium (MIP) to offset the insurance risk involved. HUD uses both one-time (for most single family mortgages except condo loans and 203K rehab loans) and monthly methods of collecting MIP. The one-time MIP is collected at the loan closing, and may be added to the loan amount and paid off along with the rest of the loan.
FHA Adjustable Rate
FHA Adjustable Rate loans are mortgages with an interest rate that adjusts periodically. The rate will adjust once a year. In general, you might choose to select an adjustable rate loan for lower initial rates and flexible qualifying.
FHA Benefits
FHA mortgages offer advantages that tend to reduce the cost impact of MIP:
Entire down payment can come from a gift.
FHA loans feature low down payments and flexible guidelines making qualifying easier.
FHA Loans are assumable by qualified borrowers.
FHA offers the advantage of Streamlined Refinancing (no requalifying required).
Term Options
The Loan Term
is the number of years it will take to pay the loan back in full. Most commonly, mortgage terms range from 10 to 30 years. For our purposes, we will compare a 15 and a 30 year loan:
30 year loan
15 year loan
Extends principal payments
over 30 yrs.
(lowest payment available)
pay more total interest
when you pay over 30 years
Extends principal payments
over 15 yrs.
(higher monthly payment)
Pay less total interest
by paying over 15 years
Build equity faster
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All rights reserved. Revised: October 16, 2000.
