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FHA 203K Streamline Renovation loans in KY

general information on the 203k

  • Intended to assist homeowners with basic repairs and modernize home.
  • Can finance up to $35,000 including reserves, etc.
  • Repairs must begin within 30 days of close & be completed within 6 months.
  • Property must be existing structure and completed at least l year.
  • Owner-occupied; one to four unit properties permitted.
  • Log homes, manufactured homes, or homes less than 1 year old are permitted.
  • No improvements to detached structures or luxury items.
  • The property must appraise to cover price plus repair and rehab cost.
  • May finance 96.5% of price plus 100% of repairs and rehab, up to 110% of "As Completed" Value.
  • FHA does not require a contingency reserve.  At the lender's discretion, reserves of the total renovation costs can be mandated to allow for cost overruns.  The reserves are part of your total $35,000.
  • Finance inspections, 203k title updates, and required working permits are allowed in this cost.

Eligible Work Items for fha 203k

  • Repair/Replacement of roofs, gutters and downspouts
  • Repair/ Replacement of HVAC, plumbing and/or electrical
  • Repair/Replacement of existing flooring
  • Minor remodeling not involving structural work
  • Exterior and interior painting
  • Weatherization: storm windows & doors, insulation, etc.
  • Appliances not exceeding $2,000 total cost
  • Access improvements for persons with disabilities
  • Repair/Replacement/Addition of decks, patios, porches
  • Basement finishing/remolding not structural in nature
  • Basement waterproofing
  • Replacement of windows, doors or exterior siding

Ineligible Work items for fha 203k Streamline

  • Any work involving relocation of a load-bearing wall.
  • Any work requiring detailed or architectural drawings.
  • New construction (including room additions).
  • Landscaping or similar site amenity improvements.

fha 203k Contractors

  • Try to use a contractor that will handle all the work and invoices. A General contractor is not required, but makes the process easier.
  • Borrower selects contractor not the lender.
  • Contractor must provide estimate for work to be done.
  • Contractor must provide licensed and carry E&O insurance.

FHA 203k loan disbursements

  • Two-party checks to Borrower(s) AND each Contractor.
  • The first payment of renovation cost is at closing.
  • The balance of costs will be released upon completion of all work, inspection by appraiser and title updates.
  • Inspection is coordinated between Investor and Borrower.
  • Any excess funds will be applied to principal balance of borrower’s loan.