FHA issued Mortgagee Letter 2024-03, updating Section 203(k) Rehabilitation Mortgage Program. Per the Mortgagee Letter (ML), FHA:
- Increased the Limited 203(k) total rehabilitation cost from a maximum of $35,000 to a maximum of $75,000;
- Introduced an annual review process for updating the maximum total rehabilitation cost for Limited 203(k);
- Extended the rehabilitation period to 12 months for the Standard 203(k) and nine months for the Limited 203(k);
- Increased the number of days that a borrower is unable to occupy the subject property during the rehabilitation period for Limited 203(k) from 15 to 30 days;
- Revised the 203(k) consultant fee schedule;
- Now permits lenders to increase the number of months of financeable mortgage payment reserves for the Standard 203(k); and
- Now allows the financing of 203(k) consultant fees for Limited 203(k).
The provisions of this ML are effective for FHA case numbers assigned on or after November 4, 2024.
Click to view the FHA Mortgagee Letter 2024-44: https://www.tenaco.com/wp-content/uploads/2024/07/FHA-Mortgagee-Letter-2024-44-07-09-24.pdf
Click to view the FHA Info 2024-44: https://www.tenaco.com/wp-content/uploads/2024/07/FHA-Info-2024-44.pdf
