HOW A 203(K) RENOVATION WORKS
From the first house hunt to the final draw, here is the 203(k) process and the contractor's role at every step.
Find the Right Fixer-Upper
The 203(k) program is for homes that are livable enough to finance but need real work. Worn kitchens, old roofs, dated baths, and structural or mechanical repairs all qualify.
Look past the finishes at the bones. Water stains, sagging floors, old panels, and pointing failures tell you where the real work is. A contractor walkthrough before your offer helps you read the scope.
A contractor walkthrough before the offer helps you understand what the renovation realistically involves and what it might cost.
Choose Your Lender and Consultant
Your FHA-approved lender sets the loan amount, the rate, and the terms. On a Standard 203(k), a 203(k) consultant writes the work write-up and inspects the milestones.
The consultant turns your wish list into a written scope the lender can underwrite. A good contractor and a good consultant working together keep the whole project moving.
We are not the lender or the consultant. We work with whichever lender and consultant you choose, and we keep our bid aligned with the consultant's scope.
Write the Detailed Contractor Bid
We walk the property with you, scope the work, and write a detailed itemized bid. It breaks the work into line items: demolition, framing, plumbing, electrical, finishes, each with its own allowance.
The lender and consultant use that bid to set the renovation budget and the draw schedule. A clear bid is what keeps the loan moving.
This is our core job. We write the bid the loan is built on, itemized and ready to underwrite.
Close and Begin Construction
Once the loan closes, the renovation funds are held by the lender and released in draws. We pull the permits and start the work in the right sequence: demolition, framing, rough-ins, inspections, drywall, finishes.
A contingency reserve is held back for the work the consultant expects to find but cannot see. When we open a wall and find rotted framing, the contingency covers the repair.
We sequence the work to the draw schedule and call for inspections at each milestone so the next payment releases on time.
Draws Release as Work Is Inspected
Each draw releases after the completed work is inspected and signed off. On a Standard project, the consultant inspects each milestone before the draw pays out.
You are never paying for work that is not done. The structure protects you and keeps the contractor accountable to the schedule.
We schedule the inspections with the consultant and the city as the work reaches each milestone, then submit the draw paperwork.
Final Draw and Closeout
When the work is finished and the final inspection passes, we deliver the closeout documentation: as-built records, manuals, and the paperwork your lender needs.
The final draw releases, the lien is released, and the project is yours.
We close out the project with the documentation your lender needs to release the final funds, and we walk the finished job with you.
READY TO START?
Walk us through the property and the scope. We will talk through the bid and the draw schedule.
Request a 203(k) Bid203(k) DisclosureEliteco Builders is a licensed general contractor, not a lender, mortgage broker, or HUD consultant. Nothing on this site is lending or financial advice. Loan programs, limits, and eligibility are set by HUD and your lender. Talk to an FHA-approved lender for financing details. For federal guidance, visit hud.gov.