203k Loans
Get a FREE quote on a 203(k) Loan & fix that home up in a hurry. Buy a fixer-upper or refinance and remodel your current home with a single, low-rate mortgage.
OVERVIEW
The Lowdown on 203(k) Loans…
An FHA 203(k) loan is a government-backed mortgage that allows buyers (and current homeowners) to finance both the purchase or refinance of a house and the cost of its rehabilitation through a single mortgage.
Here’s how it works: Let’s say you want to buy a home that needs a brand-new bathroom and kitchen. A 203(k) lender gives you the money to buy the house plus the money to do the necessary renovations. The loan amount is based on the projected value of the home after repairs are completed (up to 110% of the after-improved value), rather than its current dilapidated state. accessible to families who might not qualify for conventional financing.
Despite the name, USDA loans aren’t just for farms and remote countryside properties. In fact, 91% of the United States falls within USDA-eligible areas, including many small towns, suburban communities, and areas on the outskirts of major cities. If you’re looking outside dense urban centers, there’s a good chance your dream home qualifies.
The USDA Rural Development program offers 100% financing with competitive interest rates, low mortgage insurance, and flexible credit requirements. Whether you’re a first-time homebuyer, have limited savings for a down payment, or simply want to live outside the city, USDA loans provide an affordable path to homeownership.
Often the loan will also include:
• An up to 20% contingency reserve to ensure you have the funds to complete the remodel if costs exceed the estimates.
• A provision covering up to six months of mortgage payments so you can live elsewhere during major remodels while still paying the mortgage.
We’re here to make the 203(k) home loan process quick and painless, with tools and expertise that guide you along the way.
Benefits
Why Choose a 203(k) Loan?
Low Down Payment
Buy and renovate a home with just 3.5% down (if your credit score is 580 or higher). The down payment is calculated based on the total cost of the home plus the renovations.
One Loan, One Closing
Instead of taking out a mortgage to buy the house and a separate, high-interest personal loan to fix it, a 203(k) wraps everything into one fixed-rate or adjustable-rate mortgage.
Build Instant Equity
Because you are buying a home in need of repair—often at a discount—and upgrading it, you have the potential to build massive equity the moment construction is finished.
Flexible Credit Requirements
Backed by the FHA, these loans are highly forgiving. Borrowers with credit scores as low as 580 can qualify for the 3.5% down payment, and scores between 500-579 can qualify with 10% down.
Protects Your Budget
With built-in contingency reserves, you are protected against unexpected construction costs or hidden damage found during the remodel.
Eligibility
FHA 203(k) Loan Eligibility
203(k) loans have specific eligibility requirements set by the Federal Housing Administration. Here is what you need to qualify:
| Requirement | Standard | Notes |
|---|---|---|
| Credit Score | 580+ preferred | 580+ requires 3.5% down; 500-579 requires 10% down. |
| Down Payment | 3.5% minimum | Calculated on the purchase price + renovation costs. |
| Occupancy | Primary residence only | You cannot use a 203(k) for an investment property or flip. |
| Property Type | 1-to-4 unit homes | Single-family homes, townhouses, and approved condos. |
| Debt-to-Income | 43% maximum | May go up to 50% with strong compensating factors. |
| Contractors | Must be licensed | You cannot do the work yourself; licensed pros are required. |
Note on Loan Limits: Your total loan amount (purchase + renovation) cannot exceed the FHA loan limits for your county. For 2026, these range from $541,287 in low-cost areas up to $1,249,125 in high-cost areas for single-family homes.
IS THIS RIGHT FOR YOU?
203(k) Loans Are Ideal For…
Scenario 1: The Fixer-Upper Buyer
You found a home in the perfect neighborhood, but it’s outdated, has an ugly kitchen, and needs a new roof. A 203(k) lets you buy it cheap and customize it to your exact taste.
Scenario 2: The Current Homeowner (Refinance)
You love your current home but have outgrown it or need major updates. Instead of selling, you use a 203(k) refinance to pay for a new addition, upgraded plumbing, or a full interior remodel.
Scenario 3: The Multi-Unit House Hacker
You want to buy a run-down 2-to-4 unit property, live in one unit, and rent out the others. The 203(k) allows you to fix up the entire building as long as you occupy one of the units as your primary residence.
Scenario 4: The Budget-Conscious Buyer
You are priced out of move-in ready homes in your area. Buying a distressed property with a 203(k) allows you to break into a competitive housing market with a minimal 3.5% down payment.
Compare
How Does the 203(k) Compare?
| Feature | FHA 203(k) | Fannie Mae HomeStyle® | Standard FHA |
|---|---|---|---|
| Loan Purpose | Buy/Refi + Renovate | Buy/Refi + Renovate | Buy/Refi (Move-in ready) |
| Min. Down Payment | 3.5% | 3% to 5% | 3.5% |
| Min. Credit Score | 580 (500 with 10% down) | 620 | 580 |
| Property Types | Primary residence only | Primary, 2nd home, Investment | Primary residence only |
| Mortgage Insurance | Upfront fee + Annual MIP | PMI (removable at 20% equity) | Upfront fee + Annual MIP |
| “Luxury” Upgrades | Not allowed (e.g., pools) | Allowed (e.g., pools, outdoor kitchens) | N/A |
Wondering which loan is best for you? Let’s talk.
THE PROCESS
Your Home Loan Could Be Fully Funded in 30 to 45 Days
Complete our 203(k) Qualifier
5 min
Tell us your unique criteria and scenario.
Get Pre-Approved
1-3 Days
We verify your income and issue a pre-approval so you can shop for a home with confidence.
Get Contractor Bids
1-2 weeks
Find a licensed contractor to write up a detailed estimate for the repairs. (If using a Standard 203k, your HUD Consultant will help manage this).
Appraisal & Underwriting (2-3 weeks)
2-3 weeks
An appraiser determines the “as-is” and “after-repair” value of the home. We clear your loan for closing.
Close & Start Renovating
1-2 weeks
The seller gets paid, you get the keys, and the renovation funds are placed into an escrow account to pay your contractors as the work is completed!
203(k) Loan FAQs
Frequently Asked Questions
Q1: Can I do the renovation work myself?
Q2: What is the HUD Consultant for?
Q3: Can I add a swimming pool with a 203(k)?
Q4: Do I have to pay my current rent/mortgage while the house is being gutted?
Ready to Turn a Fixer-Upper into Your Dream Home?
Mortgage rates change every day, and your rate will vary based on your location, finances, and renovation plans. See what you qualify for in minutes