FHA 203(k) Mortgage

If you are unfamiliar with the FHA 203(k) Mortgage, have we got a treat for you! It is a great program offered by the Federal Housing Administration (FHA). With this mortgage product, you can purchase a home AND remodel or rehabilitate it all with one loan. There’s a lot of information to digest with this mortgage, so we’ll only touch on the highlights in this article. When you’re ready for more information, contact one of our loan originators today!

Benefits of an FHA 203(k) Mortgage

There are many benefits to financing your home purchase with an FHA 203(k) Mortgage. They are most notably centered around what you can DO what the loan and not necessarily the loan itself. Let’s dive in.

Finance Remodeling Costs

If you’ve ever purchased a home in need of remodeling before, you know how difficult it it can be to both purchase the home and pay for the improvements at once. Often times, you need to wait for a few years to save enough money to pay for all of the dreams you have for your new home. With the FHA 203(k) Mortgage, you can finance the cost of the home and the cost of improvements into a single loan. This allows you to have your cake and eat it, too!

Works Like an FHA Mortgage

Since the FHA 203(k) Mortgage is an FHA mortgage, many of the benefits of the loan itself are the same as those described on our FHA Mortgage page. Benefits like a low down payment and the fact that it’s easier to qualify make the 203(k) a great option for many.

Uses for an FHA 203(k) Mortgage

Remodel Your New Home

If you’ve found a great home in the perfect neighborhood, but it needs a little updating to bring it into the current century, use the FHA 203(k) Mortgage to make those updates right away.

Finance Needed Repairs

Nothing lasts forever, and the same is true for many of your home’s components. Roofs, windows, and exterior surfaces are berated by the outside elements for years and will eventually need replacing. The problem is, many of these repairs are quite costly. With the FHA 203(k) mortgage, you can finance the cost of the home and any much-needed repairs all with one low-rate loan.

Buy a Short Sale or Foreclosure

Many times short sales and foreclosures have been abandoned by their original occupants and, because of this, fall into disrepair as they sit vacant. This can be a scary prospect for a potential buyer who is unsure of the true condition of the home. A great way to mitigate this risk is by purchasing that home using an FHA 203(k) Mortgage. A thorough inspection of the home is required before purchase, so you’ll have a good idea of the items that need to be addressed during your remodeling stage.

Other FHA 203(k) Mortgage Considerations

Approved Improvements

Here is a quick down-and-dirty list of improvements and repairs you can make using your FHA 203(k) mortgage:

Roofs, gutters and downspouts
HVAC systems (heating, venting and air conditioning)
Plumbing and electrical
Minor kitchen and bath remodels
Flooring: carpet, tile, wood, etc.
Interior and exterior painting
New windows and doors
Weather stripping & insulation
Improvements for persons with disabilities
Energy efficient improvements
Stabilizing or removing lead-based paint
Decks, patios, porches
Basement completion and waterproofing
Septic or well systems
Purchase of new kitchen appliances or washer / dryer

Repairs Only Permitted with a Full 203(k)

Some items are only approved for use with a full FHA 203(k) mortgage. They include things like:

Landscaping or yard work
Major remodeling
Moving a load-bearing wall
Room additions or add-ons to the home
Fixing structural damage
Swimming pool/spa repairs

Maximum Loan Amount

The maximum amount you can borrow on an FHA loan varies by county. Look up your county’s maximum here.

*For Fresno County: 2 units=377,075, 3 units=$455,800, 4 units=$566,425.

Words of Praise

Before my wife and I set out to buy our first house we asked our financial advisors for lender recommendations. They only gave us one name: Michael Koran at Primary Residential Mortgage, Inc. After going through the entire process of securing a loan from start to finish, I can see why they didn’t mention anyone else. Buying a house is scary, especially if it’s your first time and you don’t understand the process. Mike was always there to alleviate our concerns and answer our questions. Without his knowledge and advice I would have been a nervous wreck. If you ever need to secure a loan quickly and need a responsive, reliable team that can close quickly, I would highly recommend Mike and his team. K

Kyle A.

Mike and his team are extremely professional, responsive, and knowledgeable. I will continue to refer my clients, friends, and family to Mike as I know that they will be taken care of and in the hands of somebody that I trust.

Valerie F.

I want to take the time to write and share my experiences working with Michael Koran and Primary Residential Mortgage. I first found Mike Koran back in 2009 online during one of the most uncertain financial times in History. As you can imagine I was skeptical of dealing with anyone I didn’t know personally but Michael was able to assuage me of that concern and I know that I had found the best lender I could have hope for who is honest and has an incredible work ethic while always keeping his clients best interests in mind and all times. Since then I have come back to work with Michael and his team on numerous occasions. I will always refer my family, friends and co-workers to Michael Koran and know that they will not only be in the best of hands but also get exceptional personalized service and incredibly good rates with very low costs.

Isabel S.

My husband and I recently bought our first house in Walnut Creek. While the competition in this area is not as bad as Oakland and San Francisco, we decided to go with PRMI because we believed it would give us an advantage – Mike and his team were also strongly recommended. PRMI walked us step by step through the entire mortgage process so there were no surprises. They were extremely responsive throughout the whole process. Part of the reason my husband and I liked PRMI was because Mike’s team was able and willing to do tight close of escrow and they were very open to calling the seller’s agents assuring them of our strong financial situation.We would definitely use PRMI again!

Jennifer K.

Mike is top rated, best in class, and trustworthy. I really enjoy working with him and his professional team. Responsive, smart, and knowledgeable. I have been working with Mike for nearly 10 years, can’t imagine going with anybody else.

Matt B.

My wife and I were extremely satisfied with all the work Mike and his team did on our behalf. He is responsive, trust worthy, likable, a great communicator, knowledgable at what he does, and my wife and I always felt he had our back throughout our refinance. I plan to use Mike on the future for our mortgage needs. It is not an accident that he has so many five star reviews. He is one the best and we highly recommend you work with him.