The title of your post says "20% down or 203k loan"... but then one of the options you laid out is putting 20% down AND getting a 203k loan. I am a bit confused. But going along with the question you wrote in the body of your post...
However if the home is in decent condition now (meaning an "as is" appraisal will pass lending requirements), and you have a good credit score, then I'd strongly suggest putting 15% down for a few reasons.
First, with an FHA 203k loan, even with 20% down, you will have mortgage insurance. With FHA there is always an upfront mortgage insurance premium (UFMIP) of 1.75% of the loan amount, and at 20% down the annual mortgage insurance is 1.2% (if the loan term is longer than 15 years & loan amount no more than $625,500, 1.45% for loan terms longer than 15 years & loan amounts above $625,500, .35% for loan terms of 15 years or less & loan amount no more than $625,500, or .60% for loan terms of 15 years or less & loan amount above $625,500, with a 15-year term or less & at least 22% down then there is no annual mortgage insurance). Those premiums will increase on April 1st (the FHA case # has to be ordered before then to stay at current levels).
Second, an FHA 203k rehab loan requires an additional approval process for the remodel portion of the loan - the contractor, their bid, their insurance, etc. needs to be reviewed. Then depending on the type of improvements you are doing to the property, there could be various required inspections before the rehab funds are disbursed to the contractor OR you must complete those improvements within 6 months of the loan closing. There are also some minor additional costs for an FHA 203k rehab loan, such as the supplemental origination fee, a title update, and an appraisal re-inspection fee. Additionally, FHA 203k loans can take a little longer to complete because there are variables involved (such as, are the improvements you are planning on doing to the property going to increase the value of the property by the same amount?).
Third, with a conventional loan and 15% down you are correct, there is mortgage insurance, but you have some options on how to deal with that mortgage insurance. You could pay the traditional annual mortgage insurance, which if your credit score is 720 would be .32% per year, or you could pay a 1 time single premium of 1.18% (remember FHA has the 1.75% upfront premium + an annual premium depending on the guidelines I mentioned above), or you could even take a slightly higher interest rate in lieu of paying either the annual mortgage insurance or the 1 time single premium. With the conventional loan and fixing it up after you purchase, you'd wouldn't have any stipulations on what type of improvements you could do to the property or what time frame they'd need to be completed in.
Plus, you said your offer has been accepted. I am not sure if you used the standard California Association of Realtor's contract, but within it, on Paragraph 3C(1) it specifies if you are going to be using conventional or FHA financing. If you selected conventional financing and switch to an FHA 203k loan, the seller may take issue with that.
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