Financing in Baltimore>Question Details

Keya39, Home Buyer in Baltimore, MD

Is there any sort of rehab loan or financing available that can be used with a VA loan?

Asked by Keya39, Baltimore, MD Wed Jan 6, 2010

I'm a disabled veteran and I'm approved for a VA loan. I'm interested in a bank-owned property that needs some repair work (approx. $45K worth). I didn't want to have to do a FHA loan, which requires a 3% downpayment and mortgage insurance (which is the benefit of the VA loan, no money down & no MIP) in order to get the 203K rehab loan. Any suggestions on any programs/loans I can used to rehab the house with a VA loan would be greatly appreciated.

Help the community by answering this question:


No, VA does not offer a rehab loan. Your only choices would be the FHA 203k or a USDA Rehab loan. USDA does have a rehab loans, but I don't believe they lend that much for the rehab. There are also income and geographical limitations. So, that would put you back to the FHA 203k or find a different home that can fly with a VA loan.

Below is the site for USDA.
1 vote Thank Flag Link Wed Jan 6, 2010
Guess what guys - VA does have a rehab loan, for purchase or refinance. They will allow up to $35k to be financed up to 100% of the after-repair value.

This is not a new program, but very few lenders know how to structure and process them, even though it is very similar to the FHA 203k program.

If any of you are still interested, please contact me at I can only assist Florida homeowners, but we have offices throughout the SE, SW and Pacific NW.

Good luck!
0 votes Thank Flag Link Fri Sep 19, 2014
Great question!

I have been a Realtor for over 20 years in the Boise Idaho area and have never had to deal with a major remodel up front on a VA sale (until today). I "Google'd" the question and this was the #1 listing. Since I do a lot on Trulia, I figured I would weigh in.

Did you ever find a solution?

0 votes Thank Flag Link Tue May 22, 2012
Hi Keya,

There is not a renovation loan or program that can be used with a VA loan. VA guarantees a loan much like FHA does (without the 203k renovation product), in that the home has to meet minimum property standards to be insurable.

There are changes pending in regard to FHA down payment requirements and mortgage insurance increases, but there are also benefits to a 203k loan such as the ability to do a Streamline 203k and also include monthly mortgage payments, if needed, during the improvement period so that you are not paying a mortgage and rent at the same time.
0 votes Thank Flag Link Mon Feb 15, 2010
Hello Keya!

VA doesn't have a re-hab loan available for purchases. Bob Lowery is absolutely correct with his answers posted here on both accounts.

Should you decide to use the FHA203K loan for the renovations we do originate those loans and can usually close them within a 30-45 day time frame. You can read our booklet on a link at our web site listed below.

VA loans are great to use having no downpayment or mortgage insurance so you may want to reconsider your selection of home in order to take advantage of it benefits.

Remember the new deadline to use the first time buyer federal tax credit, if eligible, is ratified contract by 4/30/10 and close by 6/3010. Get up to $8000!! If you're a current homeowner, there is a tax credit for purchasing as well if you qualify for up $6500. You can read more about them at

Good luck and happy house hunting!
Web Reference:
0 votes Thank Flag Link Wed Jan 6, 2010
That is not for a $45,000 rehab loan... can you give me the name of one lender that would do $45,000 in repairs on a VA loan?
0 votes Thank Flag Link Wed Jan 6, 2010
Its really only helpful if accurate. Below is the VA website, which explains their available programs and the minimum property requirements.

Also, when you click on the company's website on the blog you reposted, the website is no longer in existence. This blog you reposted was posted in January, 2009 and that company does not seem to be in existence any longer.
0 votes Thank Flag Link Wed Jan 6, 2010
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