5 Best FHA 203(k) Mortgage Lenders of 2021

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.

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.