FHA 203(k) Eligible Improvements | The 2 Mortgage Guys

Limited 203(k) Streamline — Eligible Improvements

These non-structural items commonly qualify on Limited 203(k) when the total rehab budget stays at or under $75,000. Structural work, foundation repairs, and room additions require Standard 203(k).

Kitchen remodels

Cabinets, countertops, fixtures, and non-structural layout updates.

Bathroom updates

Vanities, tile, fixtures, and accessibility improvements.

Flooring & paint

Interior and exterior paint, flooring replacement, and trim.

Non-structural roofing

Roof repair or replacement when no structural framing changes are required.

HVAC replacement

Furnace, air conditioning, and full system upgrades.

Windows, doors & siding

Energy-efficient windows, entry doors, and exterior siding.

Cabinets & appliances

Built-in cabinet replacement and permanently installed appliances.

Accessibility improvements

Ramps, wider doorways, grab bars, and similar modifications.

Mold & lead remediation

Health and safety remediation required for habitability.

Existing pool repairs

Repairs to an existing swimming pool — new pool construction is not allowed on Limited.

Standard 203(k) — Additional Scope

Eligible work must appear in your approved scope of work and support the after-improved appraisal.

Structural & foundation

Load-bearing repairs, foundation stabilization, and framing corrections — Standard 203(k) only. Not allowed on Limited.

Room additions

Square-footage increases when plans, permits, and consultant write-up support after-improved value — Standard only.

Roof & exterior

Full roof replacement, siding, windows, doors, gutters, and weatherization — Limited when non-structural.

Mechanical systems

HVAC, plumbing, electrical panel upgrades, and water heater replacement.

Interior finishes

Flooring, drywall, paint, trim, and finishes that restore habitability.

Accessibility & energy

Ramps, wider doorways, insulation, efficient windows, and energy upgrades when allowed.

Health & safety

Lead, mold remediation, and code-required repairs that FHA appraisals often condition.

Contingency reserve

Required on Limited: minimum 10% (15% if utilities are off). Unused contingency applied to principal.

What Underwriters Look For

Every line item must tie to habitability, safety, or lasting value under HUD rules. Luxury and recreational items are tightly restricted compared with HomeStyle.

•Licensed, insured contractor bids with line-item detail
•Limited vs Standard path correctly matched to the scope
•HUD consultant write-up for Standard 203(k)
•After-improved appraisal that supports purchase plus rehab
•Contingency reserve for cost overruns on larger scopes

Usually Not Allowed

FHA is stricter than HomeStyle on luxury and recreational improvements. See the full exclusions guide for pools, landscaping, and other items that typically stay off the loan.

Swimming pools & hot tubs
Generally excluded from FHA 203(k) renovation escrow.
Luxury landscaping
Basic grading tied to drainage may qualify; extensive hardscaping usually does not.
Recreational structures
Outdoor kitchens, sport courts, and similar amenities are typically restricted.
Personal property
Furniture and freestanding appliances that are not permanently installed are excluded.

FHA 203(k) vs. HomeStyle Improvement Scope

Improvement type	FHA 203(k)	HomeStyle
Roof / HVAC / systems	Typically eligible	Typically eligible
Kitchen / bath remodel	Typically eligible	Typically eligible
Room additions	Standard 203(k) only	Often eligible
Higher-end finishes	More restricted	More flexible
Pools / recreational	Excluded	Usually excluded

Keep Exploring

Standard vs Limited 203(k)

Which path allows structural work and larger scopes.

Eligible Home Types

Property types that can carry an FHA 203(k).

What Improvements Are Allowed?

Cross-program comparison of eligible renovation work.

Frequently Asked Questions

Can I finance a new roof with FHA 203(k)?

Yes. Roof repair or full replacement is one of the most common 203(k) improvements — especially when inspection flags aging shingles or active leaks that would block a standard FHA approval.

Are kitchen and bathroom remodels allowed?

Yes. Full kitchen and bath remodels — cabinets, countertops, fixtures, and tile — typically qualify when documented in contractor bids. Structural layout changes usually need Standard 203(k).

Can 203(k) pay for HVAC replacement?

Yes. Furnace, air conditioning, and full HVAC system replacement are eligible when tied to habitability and supported by the scope of work and appraisal.

Can I finance room additions?

Yes, with Standard 203(k) only — additions that increase square footage need plans, permits, a HUD consultant, and an after-improved appraisal that supports the cost. Limited 203(k) cannot cover additions or structural layout changes.

Does cosmetic work count toward the Limited cap?

Yes. On Limited 203(k), all eligible repairs plus fees, contingency, and financed costs count toward the $75,000 total rehab budget. Standard 203(k) has a $5,000 minimum rehab with no maximum beyond FHA loan limits.

What Home Improvements Can Be Financed With an FHA 203(k) Loan?