FHA 203k Loans - How the Loan Program Can Be Used:

 The FHA 203k Loan Program

The FHA 203k Loan program can be used to accomplish rehabilitation and/or improvement of an existing one-to-four unit dwelling in one of three ways: 

• The FHA 203k Loan can be used to purchase a home and the land on which the home is located and rehabilitate it.
• To purchase a house on another site, move it onto a new foundation on the mortgaged property and rehabilitate it.
• To refinance existing indebtedness and rehabilitate a dwelling;

If you are using the FHA 203k loan to purchase a dwelling and the land on which the dwelling is located and rehabilitate it, and to refinance existing indebtedness and rehabilitate such a dwelling, the mortgage must be a first lien on the property and the FHA loan proceeds (other than rehabilitation funds) must be available before the rehabilitation begins.