FHA 203K Question? Post it Here

Do you have a FHA 203k question you’d like to ask a 203K Specialists?  Just post it here on the blog.

Scroll down all the way to the bottom of this page (the QA post page) and type your question in the “Leave a Reply” box and press “Submit”

Your question does not have to be FHA 203K related, it can be general FHA or Conventional questions as well.   A 203K Specialists will answer your question the best to their ability.

We look forward to hearing from you!

“Your FHA 203K Mortgage Lender”






  • Kevin

    Reply Reply February 13, 2015

    I’ve found the “diamond in the rough” that I’d like to renovate and add an addition on to. Would I have to hire an architect to assist with planning out structural changes or changes in the house layout?

    • 203K Mortgage Lender

      Reply Reply February 25, 2015

      Hello Kevin

      Typically some type of “plans” will be needed for any additions or structural changes but what type whether architectural, Construction, Engineering etc. would depend on the extent and scope of the work plus the requirements of the city or county where the property is located. Once that is known then the necessary “plans” can be submitted to the lender for review. Now because additions or structural changes are in store for the property that interest you, a standard 203k loan is what you will need which would require a HUD cost consultant. That HUD consultant in return should be able to assist you on gathering up the necessary paper work related to the improvements.

      Best of luck to you on your “diamond in the rough”

  • Jenny F.

    Reply Reply November 19, 2014

    Hello! I know mobile homes are generally ineligible for 203k funds…but can a 203k loan be used to raze an old mobile home and rebuild on the existing foundation?

    • 203K Mortgage Lender

      Reply Reply December 7, 2014

      Hello Jenny,

      Generally just finding an FHA 203k Lender who can finance Mobile Homes or Manufactured homes can be a challenge if any at all, let alone one that would accept the scenario you are describing. Because regardless of the type of property the most basic requirement is that a wall must be standing and a substantial portion of the foundation must remain so razing the house would not leave anything at all above the foundation intact.

      Hope that helped, best of luck to you

  • Peter E.

    Reply Reply October 23, 2014

    Message: In June of this year I purchased a house jointly with a friend. I would like to buy the friend out. Do we have to own the house together for one year before I can buy him out in order to get a 203k loan? Can I use the 203k to buy him out as well as do renovations? Sincerely, Peter

    • 203K Mortgage Lender

      Reply Reply November 5, 2014

      Hello Peter,

      An FHA 203k Refinance is considered a “Rate & Term” refinance loan. In other words “no cash out” with the exception of paying off your existing loan(s) and funds for your home improvements /renovations. If you have owned the home less than a year then guidelines will limit and tie the value to the purchase/acquisition cost. After one year of ownership though the new appraised value can be used. But, regardless of when the refinance takes place there’s still the issue of “no cash out”. So, either the ‘Co”-borrower/owner equity is calculated as a property related debt which can be allowed or a separate cash out loan must be taken out before or after your 203k refinance.

      Best of luck

  • vicki fowler

    Reply Reply September 1, 2014

    My house is not in foreclosure yet but it will be soon if we don’t find a way to save it. My son lives with us to help. He can qualify for a loan but the house needs foundation work. Can he buy our house with a 203 loan? Our payoff is only a little over $50 and homes in our neighborhood are selling for over $150k. It’s a good investment and keeps the roof over our heads. I don’t know if it matters but we have a son still in high school.

    • 203K Mortgage Lender

      Reply Reply September 4, 2014

      Hello Vicki,

      The foundation work is doable with a 203k Loan but everything else you mentioned will not work and is not allowed on just about any type of loan under those circumstances. A loan officer can explain in more details as to why. Hopefully something can be worked out with your current lender to save your property.

      Best of luck

  • Anitra Lumpkin

    Reply Reply August 27, 2014

    Hi my name is Anitra Lumpkin

    My question is: is there a lending limit or price limit for a home?
    I would like to purchase a home that is in foreclosure and needs repairs and unfortunately I am unable to get a conventional loan because of the condition of the house. The asking price is 395,000.


    • 203K Mortgage Lender

      Reply Reply September 4, 2014

      Hi Anitra,

      There is no price limit but there is a maximum loan limit and that loan limit depends on what county the subject property is located. You can ask your Loan Officer/Lender or try this free tool where all you would need to do is put in the zip code of the property you are interested in to get the FHA Maximum Loan Limits

      Best of luck

  • Joshua

    Reply Reply August 17, 2014

    My wife and I have found a house that we would like to purchase. The price is about $36000. We are figuring it needs about $50000 to $60000 worth of work done to it. Adding a couple bathrooms and kitchen renovation. We don’t have a lot of money to use as a down payment, but we are wondering what is the typical money down that we would need to get together before we buy?

    • 203K Mortgage Lender

      Reply Reply August 18, 2014

      Hi Joshua,

      The standard minimum down payment on FHA loans is three and a half percent (3.5%) of the purchase price. That would also include FHA 203k loans that come with the funds for improvements. The difference is that the down payment is calculated based on the new total (sale price + Improvement funds). If you like feel free to use the 203k Loan calculator as it will give you an idea of what you will need to put together on the down payment. If there are questions on some of the fields on the calculator then feel free to call the 203k loan officer for your state which you can find on the lender directory.

      Hope that helps…good luck.

  • Deb

    Reply Reply June 19, 2014


    • Hi Deb,

      Having to “put money down” or in your scenario “money to close” because it’s a refinance not a purchase would depend on the value of your property in comparison to your loan amount. The good news is that you don’t need much equity (in comparison to a conventional loan) to avoid bringing money in to close when doing an FHA 203k refinance. On closing cost’s there are the typical one’s that you would have on a regular mortgage loan plus some additional one’s related to funds for improvements and yes they can be rolled into the total amount financed.

      Best of luck

  • Lin

    Reply Reply June 15, 2014

    Do you have to purchase a “as is”house first than get it inspected by a contractor to know how much renovations would cost to get a 203k loan? Or can you get a cost for renovations from a contractor before you purchase the house. Also if the house needs plumbing and electrical and a furnace do you need to get individual contractors? or do you get one contractor to handle everything. how about a well or septic?

    • Hello Lin,

      The renovation costs are estimated before you purchase the house not after (but the improvements are done after you purchase) so a contractor would need to be involved beforehand. As far as how many contractors, you are allowed to have multiple or one although how many allowed can vary from lender to lender. Plus, depending on the type of 203k (Standard or Streamline) and how many contractors are involved one of those contractors must be a General contractor.

      Best of Luck

  • Sharon R.

    Reply Reply June 4, 2014

    We recently put our older home on market and have found out we have major structural repairs that disqualify our selling in conventional market. We requested and received information re: how to update MLS listing to target 203k rehof buyers from a 203k loan specialist. We have shared this information with our listing agent. Today we got a call from him stating that “his lender” resources said we couldn’t sell our home under this program because:
    + “amount of the repairs” (full foundation lift estimated at $17000.00 + approx. $8000.00 potential repairs r/t lift).

    + “most of the repairs would need to be done prior to closing”

    + “we would need to have bids b/c of the value range”

    + “b/c of type of improvement needed (structural), some improvements are acceptable up to 10K for post closing”

    This contradicts everything we have read and researched about the standard 203k rehab loan.

    Can someone please clarify what responsibility a seller bears when marketing a home under the 203K program?

    Also, if our home does qualify, is there anything we, as sellers, should do to facilitate the process, ie, get an appraisal, get an inspection…?

    Any advice you can provide would be greatly appreciated.



    • Hello Sharon

      It would seem that you might be more informed than those you are directly and in-directly in contact with to sell your home which is unfortunate. Because it does appear your home would be a perfect candidate for the FHA 203K Standard Renovation Loan.

      If you do market your property to eligible FHA 203k buyers which most homebuyers who can qualify for a home loan can be one then it’s good news for you. Because, now those repair issues fall upon the homebuyer to take care of and virtually all repairs can be covered with a standard 203k rehab loan when it goes beyond the scope of the 203k streamline. Those repairs are all done after closing not before once the buyer is officially the owner so no repair delays and no need for the seller to worry.

      Appraisals and inspections are handled on the buying side so not much for the seller to facilitate there but pricing the property accordingly due to the improvements needed and giving a seller contribution for buyers closing costs is a step in the right direction. If you like encourage your agent or anyone else related to the sale of your home to take a tour of this website/blog and then feel free to reach out to one of the 203K Mortgage Loan Specialists listed on the Directory.

      Best of luck

  • Stephanie Husted

    Reply Reply May 30, 2014

    I recently refinanced my FHA loan and just now found another home we are interested in moving to to give us more space for our family. The home we found is in desperate need of a new roof and needs to be completely updated on the inside (kitchen, bathrooms, etc). We are unable to sale our current home because we are still underwater, but could rent it. Is it possible to have 2 fha loans at once? What would be some of the qualifications for an fha 203k loan (income needed, credit score, can you have a cosigner, etc).

    • Hello Stephanie

      Although it is possible to have 2 FHA loans “generally” FHA will not insure more than one mortgage during the same time one is already outstanding for any borrower with some exceptions such as…

      Increase in family size
      You are vacating a jointly owned property
      You were a Non-occupying Co-borrower

      Plus additional guidelines can apply as well on top of an exception such as having a minimum amount of equity (25%) on your current residence that has the existing FHA loan on it that you are planning to rent out. So, it is possible but best to get a consultation for a better understanding and to find out if your scenario would fall into one those exceptions. On qualifications, if you can qualify for an FHA loan then you should be able to qualify for an FHA 203k loan.

      Best of Luck

  • Cathy

    Reply Reply May 10, 2014

    I am the listing agent. I never see anything written about what the upside or downside would for the seller, in accepting an offer with a buyer using a 203k FHA.

  • randy

    Reply Reply January 21, 2014

    If I complete a 203K renovation, and want to refinance with normal loan later. Will the house appraise out? It seems the consultant value may be high.

    • 203K Mortgage Lender

      Reply Reply February 10, 2014

      Hi Randy

      A higher appraised value than maybe what you might have expected once the renovations are done sounds like good news. The answer is “Yes” you can refinance into another type of home loan afterwards if you think it would be beneficial because of the new higher value. The rate and terms on the 203k renovation loan are comparatively as attractive to home loans that don’t come with funds for renovations. Never the less a refinance can be done and there are no penalties for paying it off early which makes the 203k even a better financing option long or short term.

      Best of luck

  • Daniel Mendoza

    Reply Reply December 23, 2013

    I am wanting to purchase my first home. I have been living in my sisters home for the past year. She does not reside at the home anymore and it ia in need of repair. If I were to purchase the house would I be able to apply for FHA 203K? Thanks

    • 203K Mortgage Lender

      Reply Reply January 6, 2014

      Hi Daniel,

      Pretty much any single family home (up to 4 units) in just about any condition can be purchased with an FHA 203k loan. Although, there are maximum loan limits that due apply depending on the county where the property is located. In your particular case you are buying a home that belongs to your sister which could be an obstacle with many lenders because it’s not considered an “arm length transaction”. In other words you are related/connected to the seller. So, it would be best to contact a 203k lender/specialist or two or three if need be to find out their policy regarding that matter whether it’s a purchase or structured as a possible future refinance.

      Best of luck to you

  • Maria Kelly

    Reply Reply November 30, 2013

    We are inheriting a house that is in need of major repair. Do we have to own the home for 6 months before we can apply for a 203K loan. Should we apply before our current apartment lease is up in June 2014?

    • 203K Mortgage Lender

      Reply Reply December 12, 2013

      Hello Maria,

      Technically, you don’t need to wait a single day after the property is inherited since “continuity of obligation” exists. This is usually defined by being on title previously for a required time by the lender (when & if required) but in your case, inheritance negates the time restriction. In regards to applying beforehand…it’s always a good idea to get a head start to avoid or overcome any unforeseen obstacles.

      Best of luck

  • Rm gold

    Reply Reply November 15, 2013

    I am a contractor who has completed the work for the borrower. All inspections have been made and papers have all been signed and submitted. My change order work that has been performed upon request of the borrower plus unforeseen condition work has exceeded the contingency fund by about $5000. The borrower has signed off on each change order form and they have been submitted to the inspector. The inspector only submitted the change order forms to the bank totaling the sum of what is available in the contingency. Not the rest. The contingency had about 4000 available and my change order forms totaled about 9000. Why did he did not submit the total amount? I find that to be unacceptable especially considering the borrowers have signed off on each one of them. My next question is this: the borrowers are refusing to sign the final check and hand it over to me unless I give them a letter saying that I will not go after the $5000. Is that legal? Do you have any recommendations?

    • 203K Mortgage Lender

      Reply Reply December 3, 2013

      Hi RM,

      This is a rather complex situation which may be best resolved by contacting the draw specialist or department of the lender.

      Best of luck

  • Nana Dona

    Reply Reply September 12, 2013

    As a seller do I have to sign FHA escape clause allowing seller to keep deposit unless I obtain a FHA appraisal showing house value same as sale price? Can 203k loan proceed without forcing seller to allow slow buyer to keep deposit?Would you explain whether FHA requires this escape clause.

    • 203K Mortgage Lender

      Reply Reply September 21, 2013

      Hi Nana,

      The “FHA Escape Clause” you’re referring to provides for non-forfeiture of the buyer’s deposit if the property appraises for less than the purchase price. However, because it’s an FHA 203k loan the emphasis is more on the after improved value so that can be helpful and good news to the seller. Other specific provisions and certifications can still apply though. As far as the type of buyer or speed of the buying process that can vary or be the luck of the draw but regardless the seller is still obligated to sign the clause when a buyer uses FHA financing.

      Best of luck

  • Steve

    Reply Reply August 30, 2013

    I am looking into a 203k loan and I was wondering if you have to have mortgage insurance for the duration of the loan or will that stop after the proposed work is done?

    • 203K Mortgage Lender

      Reply Reply September 4, 2013

      Hi Steve,

      FHA Mortgage Insurance can be for 11 yrs. or for the whole term of the loan depending on the down payment/LTV – loan to value. That would mean it would “not” stop after the proposed work is done.

      Best of luck

  • Webb

    Reply Reply August 26, 2013

    Buying a HUD home, 203k streamline (aka big joke) The FHA appraisal on our HUD home requires plumbing work. The general contractor estimates less than $200 for the work. The underwriter is stating that HUD requires the general contractor to be licensed for plumbing…which he isn’t because our county does not require it. The repair is literally a 4 inch section of copper. Do I need to start all over with estimates from contractors over $200? This has been 60 days and our second extension…I cannot find any answers on HUD website…and lender won’t allow 2 bids.

    • 203K Mortgage Lender

      Reply Reply September 4, 2013

      Hi Webb

      When it comes to contractors and who is qualified and approved to do the work, it would be the Lenders decision not HUD’s.
      Now most G/C’s are not usually licensed for any specialty work. They have a “general” type of license and sub-contract out the work that needs specialty licenses (If necessary or required by state, county or local jurisdictions). Based on what you have described that doesn’t seem to be the case so two bids wouldn’t seem reasonable. With that said you probably would have gotten a different response from a different lender but at this late in the game all you can probably do is hang in there.

      Best of Luck

  • Denise

    Reply Reply August 24, 2013

    Would you please let me know a house that has a mold issue can be financed using a 203K renovation loan? It appears that the mold issue was caused by a faulty sump pump as there was water in the basement. All sheetrock walls and doors would need to be replaced but, right now, the Basement floor is dry.

    • 203K Mortgage Lender

      Reply Reply August 28, 2013

      Hello Denise

      Yes, mold removal & remediation can be financed using a 203k renovation loan.

      Best of luck, hope it will work out for you.

  • Latana

    Reply Reply August 19, 2013

    Can a FHA 203k loan be used to add square footage to a house? (ex. 900sq ft home).

    • 203K Mortgage Lender

      Reply Reply August 21, 2013

      Hi Latana,

      Yes, absolutely!!! Adding square footage is one of the big pluses with an FHA 203k loan. The type of 203k loan to accomplish that would be the “full” not the “streamline” version so make sure your lender offers the one you need.

      Best of luck

  • Kristina

    Reply Reply August 13, 2013

    Hi. I am having a little difficulty finding someone who can help me. I found a historic home that needs to be moved to a new location. I read on the HUD website that a 203 k loan can be used for such purpose, but when I called the Local HUD department the gentleman who said he wasn’t too familiar with the loan said the existing foundation would have to remain in place. I’m a little confused by what that means. If someone could please enlighten me on what this all means. Thank you

    • 203K Mortgage Lender

      Reply Reply August 24, 2013

      Hi Kristina,

      When you get involved with moving a house from one site to another, you will find all sorts of conflicting information and some of it can be a real head scratcher. The best way to think about moving a house is to always remember that HUD (on the 203k Loan) will not permit you to start from scratch at the new site. The new site must have an existing foundation. It can be in need of repair and it can be expanded upon/increased as necessary to accommodate the house being moved to it…. but it must be existing.

      An example would be purchasing a property with a house that literally needs to be torn down BUT the foundation is good. You could purchase that property and include the cost of the demolition plus the cost to move another house to the site as long as the existing foundation remains.

      For the most part financing for a 203k is done with the expectation that the home already was completed and therefore has a foundation and that the foundation will stay intact, can be repaired or added on to but yet existing and will remain.

      Hope that helped and made it more clear.

      Best of luck

      • Cheryl

        Reply Reply September 3, 2013

        I am having trouble with this as well. I would like to purchase a home that needs to be moved also. The property I want to move it to has a house that we are currently demolishing. It is a mobile home that was added onto and the foundation consists of basically concrete blocks that were holding up the base of the addition. The home I would like to purchase has a pier and beam foundation. So would this be considered an existing foundation If we used the same concrete blocks?

        • 203K Mortgage Lender

          Reply Reply September 5, 2013

          Hi Cheryl,

          The current foundation of the house where it’s being moved from does not play into the scenario only the foundation to where the property is being moved to. If there is an existing foundation in place there then you are on the right track to apply for 203k financing but more clarification and details would be needed. So, contact a 203k specialist for more information on what the 203k guidelines are on moving a home and existing foundations.

          Best of luck

  • jack

    Reply Reply August 10, 2013

    is there income top and bottom limits to participate in this program

    • 203K Mortgage Lender

      Reply Reply August 21, 2013

      Hi Jack

      There are no income limits to get an FHA loan with or without renovations. There are though income qualifying ratio guidelines that lenders use. Standard is 31/43 on FHA loans which includes the 203k. That means up to 31% of your income can go towards your housing expenses and 41% can go towards your total expenses (housing & other monthly debts). These are guidelines and can be surpassed which is common but by how much over depends on the automated approval, credit scores and your particular lender.

      Best of luck

  • Diane

    Reply Reply July 27, 2013

    Will a 203k loan cover the instalation of a perimiter foundation on a existing manufactured home. The home we are interested in is on pier blocks.

    • Hi Diane

      From what you have described the 203k program would permit that type of renovation…However: The problem will be locating a 203K lender that will accept manufactured homes. So, due to how few lenders do 203k’s on MFG housing, it’s best to consult with your prospective lender to find out what their guidelines are assuming they will do MFG housing.

      Best of luck


    Reply Reply July 23, 2013

    Can the owner stay in the house while its under major renovation?

    • Hi James,

      Yes, if you wish to stay in the house while its under major renovations you can but you do have the option of financing up to 6 months of payments into your loan to avoid living under those conditions unless otherwise specified by your lender.

      Best of luck

  • Isabella Francesca

    Reply Reply July 22, 2013

    Can I refinance using 203k fha loan if I am currently under a owner finance contract? Thanks

    • Hi Isabella,

      A property that has owner financing can be refinanced including it being done with a 203k loan. But, questions such as…is there a recorded lien against the property and how long have you had ownership will be some of the factors in determining if it can be done and what the maximum loan amount can be. A 203k specialist can explain more.

      Best of luck

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