FHA seeks feedback on proposed changes to rehab mortgage insurance program

The Federal Housing Administration this week announced that it is seeking industry feedback for proposed changes to the 203(k) Rehabilitation Mortgage Insurance Program, which is designed to help borrowers purchase a home or refinance an existing mortgage and include the cost of repairs or rehabilitation into one new mortgage.

Changes under consideration include increasing the maximum allowable rehabilitation costs for the limited 203(k) program from $35,000 to $50,000—$75,000 in high-cost areas—and allowing 203(k) consultant fees to be included in the financed mortgage amount. Feedback will be accepted through Jan. 5, 2024.