203(h) Loan
Highlights of the 203(h) Loan
(1) You can borrow up to 100% of your property’s value. No down payment is required. (2) Renters are welcome to apply. (3) You can purchase a new home anywhere within the United States.
Eligibility
Home is destroyed or home is damaged to the point that it needs to be reconstructed or replaced.
Property purchased or reconstructed must be a single-family home or a unit in an FHA-approved condominium project.
Must be your primary residence.
Must apply within 12 months since it was declared a major disaster area by the President.
Lender must be an FHA-approved lender.
At the time of disaster, you were living in the (PDMDA) disaster area.
Common Questions
Can I buy a new home with this program?
Yes, the 203(h) program also allows eligible borrowers to purchase a new primary residence if their previous home was destroyed in the disaster.
What are the credit requirements for the 203(h) loan?
The program has flexible credit requirements, similar to standard FHA loans. Lenders may accept lower credit scores, and individuals with damaged credit due to the disaster may still qualify.
Are there closing costs?
Yes, closing costs still apply.
Are there limits on the loan amount?
Yes, the loan limits depend on FHA guidelines and vary by location. These limits are based on the area’s median home prices.
Can I use this loan for a rental or investment property?
No, the 203(h) loan program is intended for primary residences only, not rental or investment properties.
Other Info
The 203(h) loan can be used together with the 203(k) Rehabilitation loan program. To find out more about the 203(k) loan program, click here.