The best-known type of home renovation loan is the FHA 203(k) loan. This loan comes in two versions: limited and standard. The limited FHA 203(k) loan will pay for up to $35,000 in renovations, as long as they’re not considered to be luxuries by the Federal Housing Administration (FHA). A new bathroom isn’t a luxury, but a new swimming pool would be, according to FHA guidelines.

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