Explore the Mortgage101 Library
Check Local Mortgage Rates
Loan Program Choices
Use our calculator to find out your estimated monthly payment in advance: Enter the loan amount, interest rate, and length of mortgage.
Try our Mortgage Payment Calculator
The Federal Housing Administration (FHA) makes it easier for consumers to obtain affordable HUD home improvement loans by insuring loans made by private lenders to improve properties that meet certain requirements. This is one of HUD's most frequently used loan insurance products. By the end of fiscal year (FY) 1996, it had insured almost 35 million loans totaling $43.6 billion.
The Title I program insures loans to finance the light or moderate rehabilitation of properties, as well as the construction of non residential buildings on the property. This program may be used to insure such loans for up to 20 years on either single or multi family properties. The maximum loan amount is $25,000 for improving a single family home or for improving or building a non residential structure
For improving a multi family structure, the maximum loan amount is $12,000 per family unit, not to exceed a total of $60,000 for the structure. These are fixed rate loans, for which lenders charge interest at market rates. The interest rates are not subsidized by HUD, although some communities participate in local housing rehabilitation programs that provide reduced rate property improvement loans through Title I lenders.
Only lenders approved by HUD specifically for this program can make loans covered by Title I insurance. While most lenders and contractors use this program responsibly, HUD urges consumers to use caution in choosing and supervising home repair contractors conducting Title I repair/renovation work. A recent HUD review of Title I uncovered many instances of unscrupulous contractors performing shoddy work falsifying documents overcharging homeowners and using deceptive advertising. HUD encourages homeowners to work directly with their lender in selecting a home repair contractor in order to prevent inflated estimates.
- 3 Factors that Can Negatively Affect Your Mortgage Application
- Appraisal Basics
- Second Mortgages: Advantages and Disadvantages
- FHA Eligibility with Bankruptcy and Foreclosure
- Short Selling a Rental Property
- Home Equity Loans for People with Bad Credit
- Should You Refinance? Make Sure the Timing is Right
- 3 Warning Signs of Loan Modification Scams
- What Lenders Don't Reveal About Home Equity Loans