There are two programs to discuss here. The full 203k and the 203k streamlined. The 203k is your major renovation loan where your repairs will be in excess of $35,000 and/or an engineer is required. Since the streamlined product is the more popular one, below you can find details about the program.
- Used for minor cosmetic work
- Should ideally be used for no more than 3 jobs total
- No consultant / engineer / architect required
- Property cannot be vacant for more than 30 days.
- Work must be completed within six months.
- Work must be professional.
- If job requires a permit, borrowers must get a permit and a sign-off.
- Work must commence within 30 days from closing.
Eligible Repairs & Improvements
- 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 Not Permitted
- Landscaping or yard work
- Major remodeling
- Moving a load-bearing wall
- Room additions or add-ons to the home
- Fixing structural damage
Disbursement of Payments
- Maximum of two payments to each contractor, including the borrower, providing the borrower works under a "self help" plan.
- No more than a 50% advance is allowed.
- Do-it-yourself allowances do not include labor; only materials costs are allowed.
- Final payment is paid after submission of evidence of payment to sub-contractors / suppliers or other possible lien claimants.