Home Repair Loans (Streamline 203k)

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

The Streamline 203k home repair loan, a modification of the standard Section 203k home rehab loan, facilitates purchase transactions in which the home needs minor rehab work, such as identified in a pre-purchase home inspection or an FHA appraisal.  The Streamline 203k limited repair loan is intended to assist homeowners with basic repairs costing at least $5,000 but not greater than $15,000.  The mortgage amount will allow for acquisition of the property and up to $15,000 in the loan proceeds to be applied toward repair or rehab of the property.

Supplemental Origination Fee

For a Streamline 203k home repair mortgage, the lender may collect a supplemental origination fee equal to the greater of $350.00 or 2.5% of the cost of the improvement project not to exceed $375.00 from the borrower for the rehab portion of the mortgage.  This is in addition to the origination fee of one percent of the mortgage amount related to the purchase price.

Eligible Repairs or Improvements

The types of home repairs or improvements that borrowers may make with Streamline 203k home repair loans are limited to the following:

  • Repair / replacement roofs, gutters and downspouts
  • Repair / replacement / upgrade of existing HVAC systems
  • Repair / replacement / upgrade of plumbing and electrical systems
  • Repair / replacement of existing flooring
  • Minor remodeling that does not involve structural repairs, such as kitchens
  • Exterior and interior painting
  • Weatherization, including storm windows and doors, insulation, weather stripping, etc.
  • Appliances, when at least $3,000 of basic home repairs is involved.  Appliances may include free-standing ranges, refrigerators, washers/dryers, dishwashers and microwaves and may not exceed $2,000 in total cost.
  • Improvements for accessibility for persons with disabilities

Ineligible Repairs or Improvements

Properties that require the following work items are not eligible for financing under the Streamline 203k limited repair mortgage:

  • Major rehab or major remodeling, such as the relocation of a load-bearing wall
  • New construction (including room additions)
  • Repair of structural damage
  • Repairs requiring detailed drawings or architectural exhibits
  • Any environmental mitigations including modifications involving disturbance of painted surfaces in pre-1978 properties or any lead based paint abatement
  • Landscaping or similar site amenity improvements
  • Any repair or improvement requiring a work schedule longer than six (6) months
  • Rehab activities that require more than two (2) payments per specialized contractor.

If you require one of the above ineligible repairs, you may want to review the list of eligible improvements under a standard Section 203k home rehab loan.

Borrowers may not use a Streamline 203k limited repair loan to finance any required repairs that would:

  • Require a “consultant” to develop a “Specification of Repairs/Work Write-Up”
  • Require plans or architectural exhibits
  • Require a plan reviewer
  • Require more than six months to complete (HUD will not grant extensions)
  • Result in work not starting within 30 days after loan closing
  • Cause the borrower to be displaced from the property for more than 30 days during the time the rehab work is being conducted (in a typical case, the borrower should be able to occupy the property after mortgage loan closing).
The information provided in this website is not legal advice and should not be interpreted as legal advice. This website is intended to provide a basic understanding of this information in summary form. This information may not be comprehensive, is subject to change, and may not apply to all individual circumstances. Any information received here should be confirmed with the appropriate government agencies or with an attorney, particularly as it relates to your individual circumstances. Your use of this website indicates your agreement to be bound by our Terms of Use.