Can I do the work myself?

Generally the lender wants licensed contractors with written bids. Fannie Mae allows limited do it yourself work under strict rules.

How long do I have to finish?

Each program sets a time limit. HUD extended the Limited 203(k) rehab period to nine months in 2024.

Is a renovation loan better than a HELOC?

If you are buying a home that needs work, a renovation loan lets you borrow against the finished value. For an owner with equity, a HELOC can be simpler.

Renovation loans: FHA 203(k) and Fannie Mae HomeStyle

A renovation loan lets you finance the purchase or refinance of a home and the cost of repairs in one mortgage. The two main programs are FHA 203(k) and Fannie Mae HomeStyle Renovation.

FHA 203(k)

Standard 203(k): for larger projects, including structural work, with a HUD consultant.
Limited 203(k): for smaller, non structural work, with rehab costs up to $75,000 under HUD Mortgagee Letter 2024-13.
FHA loan limits for your county still apply, and you must live in the home.

Fannie Mae HomeStyle

Renovation costs can be up to 75% of the lesser of the purchase price plus renovation costs or the as-completed value when you buy.
Can be used for a main home, second home or investment property.
Work is usually paid out in draws as it is completed and inspected.

Questions people ask

Can I do the work myself?: Generally the lender wants licensed contractors with written bids. Fannie Mae allows limited do it yourself work under strict rules.
How long do I have to finish?: Each program sets a time limit. HUD extended the Limited 203(k) rehab period to nine months in 2024.
Is a renovation loan better than a HELOC?: If you are buying a home that needs work, a renovation loan lets you borrow against the finished value. For an owner with equity, a HELOC can be simpler.

Official sources

Facts checked 2026-11-01. General information, not financial, legal or tax advice. We are not a lender.

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