Home Renovation Loans and 203(k) Financing in Rhode Island

How it works

RIHousing offers FHA 203(k) renovation loan and refinance mortgage programs for Rhode Island homeowners. The page says you can wrap the cost of buying, rehabbing, and/or building an accessory dwelling unit (ADU) into one mortgage. It is positioned as a way to buy and renovate, or refinance and renovate, with one affordable loan.

What the money covers

The page lists examples of covered renovations: electrical work, HVAC systems, new appliances, roofs, health and safety standards, sewer hookup, well and septic systems, and building an ADU. It also says repairs that are structural in nature, or more than $75,000, are considered under the Standard 203(k) Rehabilitation program.

Amounts and matching

The page does not state a fixed dollar amount, grant size, or match requirement. It does say total purchase cost and rehabilitation costs must not exceed FHA Maximum Loan Limits. After closing, RIHousing holds repair funds in escrow, disburses payments to the contractor, and manages a contingency reserve of up to 20% of the rehabilitation costs. Any unused funds are applied to the principal balance of the loan.

How to apply

The page says applicants should start by connecting with the RIHousing Loan Center or one of its approved Participating Lenders. It also says 203(k) applicants must complete an FHA 203(k) Homebuyer Education class prior to closing, and that the class is offered online for a $15 fee.

Timing and deadlines

The page does not give an application deadline. It does say the homebuyer education class is required before closing, and that the program is available for homeowners seeking refinancing as well as buyers financing a renovation.