5 Best FHA 203(k) Mortgage Lenders
Buying a fixer-upper or remodeling your current home? NerdWallet has selected some top FHA 203(k) lenders to make your loan search easier.
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Home buyers can use an FHA 203(k) loan to purchase and renovate a house with the same mortgage. FHA 203(k) refinance loans also roll the cost of home improvements into a monthly mortgage payment.
To take advantage of this versatile mortgage product, NerdWallet has identified some of the top FHA 203(k) lenders.
Home buyers can use an FHA 203(k) loan to purchase and renovate a house with the same mortgage. FHA 203(k) refinance loans also roll the cost of home improvements into a monthly mortgage payment.
To take advantage of this versatile mortgage product, NerdWallet has identified some of the top FHA 203(k) lenders.
Best FHA 203(k) Mortgage Lenders
| Lender | NerdWallet rating | Min. credit score | Min. down payment | Learn more |
|---|---|---|---|---|
 New American Funding: NMLS#6606 Learn more at New American Funding | Best for nontraditional credit | 500 | 3.5% | Learn more at New American Funding |
 Fairway Independent Mortgage: NMLS#2289 Learn more at Fairway Independent Mortgage | Best for first-time home buyers | 640 | 3.5% | Learn more at Fairway Independent Mortgage |
 Guild Mortgage: NMLS#3274 | Best for digital convenience | N/A | 3.5% | Read review |
 PrimeLending: NMLS#13649 | Best for borrowers with weaker credit | 580 | 3.5% | Read review |
 Sebonic Financial: NMLS#66247 | Best for digital convenience | 580 | 3.5% | Read review |
at New American Funding
New American Funding: NMLS#6606
Min. credit score
500Min. down payment
3.5%at New American Funding
at Fairway Independent Mortgage
Fairway Independent Mortgage: NMLS#2289
Min. credit score
640Min. down payment
3.5%at Fairway Independent Mortgage
Guild Mortgage: NMLS#3274
Min. credit score
N/AMin. down payment
3.5%PrimeLending: NMLS#13649
Min. credit score
580Min. down payment
3.5%Sebonic Financial: NMLS#66247
Min. credit score
580Min. down payment
3.5%Last updated on August 1, 2022
Methodology
The star ratings on this page reflect each lender's rating for FHA products. Read more about how we determine those ratings.
The lenders on this page are chosen using this methodology:
NerdWallet reviewed nearly 60 mortgage lenders, including the majority of the largest U.S. mortgage lenders by annual loan volume (lenders had to have at least a 1% market share), lenders with significant online search volume and those that specialize in serving various audiences across the country.
For inclusion on this roundup, lenders must score a 4 or above according to our FHA loan methodology and offer 203(k) loans.
NerdWallet solicits information from reviewed lenders on a recurring basis throughout the year. All lender-provided information is verified through lender websites and interviews. We also utilized 2020 HMDA data for origination volume, origination fee, rate spread and share-of-product data.
To recap our selections...
NerdWallet's Best FHA 203(k) Mortgage Lenders
- New American Funding: Best for nontraditional credit
- Fairway Independent Mortgage: Best for first-time home buyers
- Guild Mortgage: Best for digital convenience
- PrimeLending: Best for borrowers with weaker credit
- Sebonic Financial: Best for digital convenience
Frequently asked questions
In addition to the lenders we've highlighted above, you can also use the Department of Housing and Urban Development's FHA lender search page to find FHA 203(k) loan lenders. It's a helpful tool, because while FHA 203(k) rehab loans are widely available, not every FHA-approved lender offers the 203(k).
To use the HUD search tool, enter your search parameters — your state is probably the most important, since lenders are licensed by individual states — and click the "Rehabilitation" box at the bottom of the list, where it says "203(k) Rehabilitation Mortgage Insurance Program." If you're trying to get the scoop on a specific lender, you can just enter the company name at the top of the form, then click the "Rehabilitation" box at the bottom.
» MORE: Tips on choosing an FHA lender
Yes. FHA 203(k) loans have the same down payment requirements as standard FHA loans. If your credit score is 580 or above, the FHA allows a down payment that's as low as 3.5%. For credit scores between 500 and 579, the required FHA down payment is 10%.
It's important to note that while the FHA has low credit score requirements, individual lenders may choose to set higher minimums. If your credit score falls below 620 or so, you may need to do more hunting to find a lender that will approve your 203(k).
Keep in mind that all FHA loans, including the 203(k), allow you to use gift money or other forms of down payment assistance to help come up with that 10%.
To qualify for an FHA 203(k) loan, you'll have to meet the same FHA requirements you would for a standard loan. These include the credit score and down payment minimums mentioned above, as well as having a debt-to-income ratio of at least 50%.
The property you're buying or refinancing must be your primary residence. Though the home does not have to be up to the FHA's housing standards — after all, you're fixing it up — it's expected that after your repairs and upgrades, the property will pass an FHA appraisal.
