The federal governmentsSection 203 (k) program is designed for the rehabilitation and improvement of single family properties and is viewed as a tool for neighborhood revitalization and expanding home ownership. In the past, when a Mobile Eastern Shore real estate buyer wanted to purchase a home in need of repair or modernization, he/she had to first obtain financing to finance the dwelling and then find additional financing to do the rehabilitation work. With the 203 (k) plan, however, the buyer can get just one mortgage–at a long-term fixed or adjustable rateto finance both the purchase and the repair of the property.

toolsUSES AND APPLICATIONS: This program can be used in various ways:

1. To purchase a home and its land for rehabilitation

2. To purchase a dwelling at one site and move it to another mortgaged property for rehabilitation

3. To refinance existing secured loans on a home for rehabilitation

4. To convert a one-family dwelling to a two, three, or four family residence OR

5. To convert a multi-family dwelling to a one-family home.



1..Must be a one-to-four family dwelling that is at least one year old

2. If the dwelling has been demolished, some of the foundation must remain


1. All construction must comply with HUD Minimum Property Standards

2. All rehabilitation dealing with thermal or heating/AC systems must be energy efficient

3. Cash-paying home buyers can refinance their Mobile Eastern Shore real estate within six (6) months of purchase in order to make improvements

As with any government funded programs, the property to be purchased is subject to appraisals to determine the “as-is” and “after rehab” values of the real estate. In addition, the Mobile Eastern Shore homeowner will be expected to provide HUD with the following:

1. A plot plan of the site

2. Proposed interior plan of the dwelling

3. Work write-up and cost estimate

HUD also offers an FHA Streamlined 203 (k) program that allows buyers or owners of Mobile Eastern Shore real estate to purchase or refinance a home that needs up to $35,000 of rehab/repair work. Eligible owners may borrow the money even if they don’t have the equity usually required. In addition, the streamlined program requires much less paperwork than does the regular 203 (k) and thus simplifies the process for obtaining funding for improvements/repairs. Typical improvements approved for this program include such things as :

*Roof, gutter, downspout repair/replacement

*HVAC systems

*Plumbing and electrical work

*Basement completion/waterproofing

*Purchase of appliances

*Minor remodeling of kitchens and bathrooms


*Windows and doors

*Decks, patios, porches

A complete list of acceptable uses of the 203 (k) funds can be found here.

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