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Eligible Improvements

The great news about a 203(k) loan is that nearly any improvement(s) to a home are eligible, including ones such as: an addition on a house, a new roof, new flooring, new kitchen appliances, landscaping, plumbing, electric wiring, etc.  All health, safety, and energy conservation items must be addressed prior to completing general home improvements.  (Also see Energy Efficient Mortgage Program Section.)

CLICK HERE FOR MORE INFORMATION ON ELIGIBLE IMPROVEMENTS

Required Improvements

All rehabilitation construction and/or additions financed with Section 203(k) mortgage proceeds must comply with the following:

A. Cost Effective Energy Conservation Standards

  1. Addition to existing structure. New construction must conform with local codes and HUD Minimum Property Standards in 24 CFR 200.926d.
  2. Rehabilitation of Existing Structure. To improve the thermal efficiency of the dwelling, the following are required:
    • Weatherstrip all doors and windows to reduce infiltration of air when existing weatherstripping is inadequate or nonexistent.
    • Caulk or seal all openings, cracks or joints in the building envelope to reduce air infiltration.
    • Insulate all openings in exterior walls where the cavity has been exposed as a result of the rehabilitation. Insulate ceiling areas where necessary
    • Adequately ventilate attic and crawl space areas. For additional information and requirements, refer to 24 CFR Part 39.
  3. Replacement Systems.
    • Heating, ventilating, and air conditioning system supply and return pipes and ducts must be insulated whenever they run through unconditioned spaces.
    • Heating systems, burners, and air conditioning systems must be carefully sized to be no greater than 15 percent oversized for the critical design, heating or cooling, except to satisfy the manufacturer’s next closest nominal size.

B. Smoke Detectors. Each sleeping area must be provided with a minimum of one (1) approved, listed and labeled smoke detector installed adjacent to the sleeping area.

[For an Approved 203(k) Lender click here or call 888-299-4484]