FHA 203k – Standard vs. Streamline

As a licensed loan originator, it is my goal to originate loans that fit the needs of each individual buyer.  To do this, I strongly believe that educating potential home buyers as well as Real Estate Professionals is an absolute must.  In my tenure as a loan officer, the FHA 203k rehabilitation loan has perhaps been the most misunderstood loan and in my opinion, I think it could be one of the most advantageous loan options to considered.  Truth be told, many loan officers and real estate professionals simply don’t understand the loan program and therefore suggest that buyers stay away from the loan altogether.  Here’s just a few of the myths I consistently hear:

Separating Myths from Facts:

  • Myth:              I have to finance at least $5,000 in repairs to be eligible for the FHA 203k loan.
  • Fact:                There are two types of FHA 203k Loans (Standard and Streamline).  One of which has no minimum requirement for dollars spent on repairs and upgrades!
  • Myth:              It takes months to close on an FHA 203k loan
  • Fact:                The fact is that most FHA 203k loans close between 30 and 45 days!
  • Myth:             The home I’m interested in buying won’t qualify for an FHA 203k loan.
  • Fact:                Virtually every home qualifies for the FHA 203k Loan!  In fact, with the Standard 203k loan, a home buyer can demolish a home down to the foundation and rebuild the entire home!
  • Myth:              I can’t pick the upgrades that I really want.
  • Fact:                The truth is the FHA 203k loans allows for almost any upgrade and/or repair outside of landscaping and pools!


Which FHA 203k Loan, Standard or Streamline, is Right for You?


  • Repairs and Improvements must be at least $5,000
  • NO maximum repair amount
  • Used to facilitate major repairs and improvements


  • NO minimum repair amount
  • Maximum repair amount of $35,000
  • Used to facilitate uncomplicated repairs and improvements

The Standard and Streamline 203k loans both allow a home buyer to finance up to 110% of the future value of the home; that is the value of the home when considering all repairs and upgrades.  If you’re shopping for a home and find yourself saying, “This home is great!  I just wish it had….” then the FHA 203k loan might just be the loan program for you!  If you would like to learn more, contact Michael McDermott and The McDermott Team with Nova Home Loans.

Your Trusted Mortgage Advisor,

Michael McDermott

The McDermott Team – Powered by Nova Home Loans

Licensed Loan Officer – NMLS: 184065

Office:    623.792.6806
Cell:        602.694.5279
Fax:        480.389.2572

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