Renovation Home Loan

Prime Mortgage Lending, Inc. offers a FHA Renovation Home Loan as just one of its many loan packages available. FHA Home Loans have been helping people since 1934. The Federal Housing Administration (FHA) insures the loan, so we can offer you a better deal. Are you interested in:

Low down payments
Low closing costs
Easy credit qualifying
203k Limted
203k Standard

For Questions: Call (828) 348-1907

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Many mortgage loan products which are well suited for first-time homebuyers, FHA loans have more relaxed requirements than conventional mortgages. In some cases, you can have a recent bankruptcy in your past and still qualify for a loan. Protected by the Federal Housing Administration, these loans may be attractive to first-time homebuyers for these benefits:

• Down payments for an FHA loan may be as low as 3.5% of the purchase price, not 20% or more.
• You can use a monetary gift for your down payment and closing costs.
• You can get either fixed or adjustable interest rates with a FHA loan.
• FHA loans may be streamlined, so you need less paperwork, simplifying the process.
• Grants and down payment assistance programs help you cover closing costs.

What is a FHA Renovation Home Loan?

203k Limited and 203k Standard option offered for both purchases and refinances

Offers a solution to help borrowers obtain financing that covers both the acquisition and/or rehabilitation of the property.

To learn more about the benefits of FHA Renovation Home Loan, please contact us.

FHA203(k) Renovation Home Loan

Limited Features

203(k) Limited option is intended to help facilitate uncomplicated improvements/repairs.

No minimum rehabilitation amount
Maximum $35,000 in total rehabilitation costs
Does not require an FHA HUD Consultant or a General Contractor
Up to 3 licensed contractors allowed
Work to start within 30 days of closing
Work to be completed within 90 days
2 draws permitted
50% of Contractor(s) Bid at Closing

FHA203(k) Renovation Home Loan

Standard Features

Used to CONSTRUCT, REPLACE, or for ADDITIONS , Standard 203(k) additions are large scale add-ons , For complicated projects and cosmetic updates

Requires an FHA HUD consultant
Minimum cost of repairs is $5,000; no max repair amount
Contingency reserve 10-20% (determined by HUD consultant)
Work to start within 30 days of closing
Work must be completed within 180 days of closing
Maximum of 5 draws permitted
General Contractor is required
Additional specialized contractor(s) allowed for technical items
Can finance up to 6 months PITI if home deemed uninhabitable by HUD consultant
No funds are disbursed to contractor or borrower at closing
As repairs/renovation work is completed and draws are requested:
10% holdback is withheld from each draw
Draws released when acceptable Consultant inspection(s) received

Contingency Reserves explained:

A Contingency Reserve is held in the Borrowers Renovation Escrow Account from the loan proceeds to cover health and safety costs that arise during construction (i.e. mold/termite)

FHA 203(k) LIMITED – Any funds remaining at the end of the renovation process must be applied as a principal reduction.

FHA 203(k) STANDARD -Any funds remaining at the end of the renovation process may be applied as a principal reduction or a change order can be submitted for review and approval.

We keep your loan application process simple

FHA203(k) Limited Renovation Home Loan – Eligible Repairs

Repair/replacement/upgrade of mechanical items such as:

Roof, gutters/down spouts 
HVAC systems 
Plumbing/Electrical systems 
Flooring

Minor remodeling (i.e. kitchen/bath without structural changes)

Painting (exterior and interior) or lead paint stabilization

Weatherization (i.e. storm windows and doors)

Purchase and installation of appliances

Mold remediation

Well/septic minor repairs

FHA203(k) Limited Renovation Home Loan – Not Eligible Repairs

Major rehabilitation work not eligible:

New construction 
Relocation of load-bearing walls 
Room additions 
Repairs of structural damage

Repairs identified in appraisal as requiring a:

Consultant Work Write-Up
Plans or architectural exhibits

Installation of well/septic not eligible (minor repair is ok)

FHA203(k) Standard

Renovation Home Loan

– Eligible Repairs

The FHA203(k) STANDARD option is used for more complicated projects. Eligible repairs include:

Major structural alterations and additions 

Major landscaping and site improvements 

Repair swimming pool 

Remodeling of rooms, including kitchens & bathrooms 

Relocation of load bearing walls 

Construction or rehab of detached garage 

Converting multi-unit to a single unit or a single unit to a multi-unit 

Basement finishing or waterproofing 

Appliances used in remodel

Well/septic work

Retrofitting a home for Special Needs or Handicapped Access features 

FHA203(k)Limited – Tips

Total rehabilitation cost (labor/materials) should not exceed the following amounts to allow for contingency reserve:

10% contingency: approx. $31,250 total rehab cost
15% contingency: approx. $30,000 total rehab cost

Fees cannot be waived or altered to adjust below the maximum repairs of $35,000

This includes borrower-financed contingency reserve

Borrower cannot pay for any portion of the project outside of closing

Ex: Cannot pay for materials not covered in bid
Ex: Borrower cannot do demo work

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About Us

How we can help you

Although labeled an independent mortgage lender, Prime Mortgage Lending, Inc. is not a one-man operation. Zachery Adam and his Team has the support of a streamlined operation, with professionals who assist in every phase of the loan process. His team includes an appraisal vendor, loan processors, underwriters, closers and even the CEO or president if needed. When you choose to work with Zachery, you get the support of his team as well.

Zachery Adam

It’s important to Zack that he and his team are approachable and can provide assistance to home buyers who are often inundated with misinformation about the financial picture and mortgage options. In an automated culture reliant on digital communication, it’s time to put the human element back into these conversations. He could never be behind the scenes.

Daniel Clancy

Today, Dan likes working with first time home buyers to help them through the often intimidating process of buying a home. In just the time he’s been with Prime Mortgage Lending, Inc., Dan has been able to work with a number of diverse products including USDA, FHA, and VA loans. This has given him great insight very quickly about the best ways to work with homebuyers.