Home Rehab Loans (Section 203k)
Required Home Improvements

For home rehab activities that do not also require buying or refinancing the property, borrowers may also consider a Title I Home Improvement Loan.

All rehab construction and/or additions financed with a Section 203(k) home rehab loan must ensure that (1) each sleeping area is provided with a minimum of one approved, listed and labeled smoke detector installed adjacent to the sleeping area, and that (2) the property complies with the following cost effective energy conservation standards:

Addition to Existing Structure

New construction must conform with local codes and HUD Minimum Property Standards

Rehab 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 rehab; insulate ceiling areas where necessary
  • Adequately ventilate attic and crawl space areas

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
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