5) Assess the Property:

The property you intend to purchase or refinance with a 203K loan must meet certain requirements. It must be a primary residence, 1-4 units and the total loan amount including the rehabilitation costs cannot exceed the Rhode Island FHA 203k Loan Limits for your property's location.

6) Determine Renovations & Repairs:

Determine the scope of the renovations or repairs needed for the property and obtain cost estimates from licensed contractors. The total cost of repairs must fall within FHA guidelines and should be outlined in a detailed proposal.  Up to $75,000 maximum for the limited 203k and any amount above that the standard 203k has you covered.

7) Undergo Property Appraisal:

Your lender will order a 203k Appraisal of the property to determine its value after the proposed renovations. This helps ensure that the loan amount aligns with the property's worth.

8) Receive Loan Approval:

Once your application is processed and approved by your lender, you will receive a commitment letter outlining the terms and conditions of your loan.

9) Close on the Loan:

Sign all the necessary paperwork to finalize the loan agreement. Along with signing your final loan approval documents at closing, you will also be required to bring in your 203k Down Payment and money for Closing Costs.

10) Begin Rehabilitation Work:

After closing, the rehabilitation work can commence. Funds for the renovations will be held in escrow and disbursed as needed to cover the cost of materials and labor. Rehab funds will be approved by both you and the contractor before disbursed.