Can I include repair costs in my FHA loan?

By Justin Lazzaro, NMLS #1229453
Published October 23, 2026. Last reviewed October 23, 2026.

Yes, if you qualify. FHA's Limited 203(k) program lets you borrow up to $75,000 for repairs and improvements as part of the loan you use to buy the home. It's meant for smaller projects that don't touch the home's structure, and the home has to be the one you live in.

What work does the Limited 203(k) cover?

It covers smaller, nonstructural projects. HUD's examples include minor remodeling, home improvements, energy upgrades, new appliances and replacing dated flooring.

Structural repairs and major remodeling aren't eligible under the Limited version. Neither is work that would keep you from living in the home for more than 30 days in total. Bigger projects go through FHA's Standard 203(k), which has its own rules and requires a HUD-approved consultant.

How much can you borrow for repairs?

Up to $75,000 in total repair costs, under HUD's current limit. The cost of energy improvements can be added on top of that, and there's no minimum repair amount.

HUD raised the limit to $75,000 for FHA case numbers assigned on or after November 4, 2024, and says it will review it each year along with FHA's loan limits. Your total loan still has to fit within FHA's limits.

How does the work get done and paid for?

A contractor does the work after closing, and the repair money is paid out in stages, called draws. Since June 23, 2026, HUD allows up to four draws for each contractor: one at closing, up to two while the work is underway, and a final draw. Before that change, the limit was two.

The work has to be finished within nine months. A HUD-approved 203(k) consultant isn't required for the Limited version, though one can be used.

What should you plan for?

The repair money is borrowed. It adds to your loan balance, and because FHA mortgage insurance is based on the loan amount, it adds to that cost too.

The home has to be your primary residence, so investors can't use this program. Expect more steps than a standard purchase, since the repair plan has to be in place before you close. Lenders can also add requirements of their own on top of HUD's rules.

Who this doesn't cover

This article covers FHA's Limited 203(k) only. Structural work and larger remodels use FHA's Standard 203(k). Conventional loans have their own renovation options with different rules. Reasy Financial, LLC is not affiliated with HUD, FHA or any government agency.

Your next step

Found a home that needs some work? Request a quote, and I'll show you how the repairs could fit into an FHA loan. You can also compare renovation loan options or read more about FHA home loans.

Sources

This article is for general information only. It is not an offer to lend or a commitment to lend. Loan programs and guidelines change, and approval depends on credit, income, assets, property and program eligibility. Not all borrowers qualify. Market information is as of the date shown and comes from the sources credited. Any average rate mentioned is a national survey figure from its named source, not a rate offered by Reasy Financial, LLC or Justin Lazzaro. Justin Lazzaro, NMLS #1229453. Reasy Financial, LLC, NMLS #2446155, AZ BK 2012302. Equal Housing Opportunity.