Maryland FHA 203K Loans

Secured Funding has an exclusive branch for its 203K loans. For more in-depth information please visit Secured Funding's exclusive 203K site,, otherwise continue reading below.  

If you are looking into upgrading your property, or purchasing a property that needs repairs and you want to include the cost of the repairs into your mortgage loan, a Maryland FHA 203K loan (also known as a HUD 203k Rehab loan) may be the best choice for you. Not only does the mortgage loan cover your repair or upgrade costs, but it provides you with mortgage insurance from the Federal Housing Administration.

Purchasing a Home with FHA 203K

With so many foreclosed and short sale homes on the market, there are many low priced fixer-uppers available for purchase, but most lenders will not give a mortgage loan without the home meeting certain standards, and require major repairs to be made prior to funding the home loan. However, you do have the option to purchase a home and include a remodel or repairs within the loan to be completed after the home mortgage is funded with an FHA 203(k) rehab loan if you plan on the home being your primary residence. An FHA 203k loan in Maryland could cover expenses such as a kitchen cabinets, major appliances, bathroom tubs and toilets, drywall etc; including labor to install these products, as well as a 10-20% increase in the rehab part of the loan to cover an unforeseen expenses (such as a rusted pipe needing replaced under the floor) and you may even be eligible to get up to 6 months of mortgage payments financed in order to do the repairs.

An FHA 203k Rehab mortgage loan requires a minimum of 3.5% of the home purchase price plus the repair costs. There are two types of 203k loan, a regular, and “streamlined” or “modified.” Regular FHA 203k loans are for properties that need repairs to the structure, while streamlined FHA 203k loans are for non-structural repairs only. A regular 203k loan covers the least value of the home as is, plus the costs to rehabilitate, or up to 110% of the expected value of the home after the work has been completed on it. A streamlined FHA 203k loan allows for a maximum of $35,000.00 in addition to the purchase price of the home. Also- an FHA 203k rehab loan is not meant for investors, instead it is meant for owner-occupants. Your property must meet the eligibility requirements of the FHA as well as the repairs that you are looking to make to the property.

In order to apply for an FHA 203K Purchase loan in Maryland, you need the same paperwork as you would any mortgage loan, with two major additions; a detailed scope of work that you want included in the loan, with parts and labor costs and an appraisal of the current value of the home along with an appraisal estimate of the home’s value after the repairs have been made. You do not have to hire someone to do the labor if you can prove that you are knowledgeable and capable of completing certain repairs yourself, for example, if you are a plumber, you may not be required to hire someone to install your bathtub.

Once your loan has been approved and you have purchased the home, the maximum amount of time you have to complete the rehab is 6 months, and if you are not able to live in the home during the rehab, you may be eligible to include up to that many mortgage payments.