If you are buying a fixer-upper in Detroit with an FHA 203K loan, the single biggest decision you will make is which contractor to hire. Most general contractors say no to 203K work because of the HUD paperwork, the draw schedule, and the inspections. The ones who say yes, and know what they are doing, are worth finding.
Standard vs. Limited 203K
There are two versions of the loan. The Limited 203K (sometimes called Streamline) covers up to $75,000 in repairs and is meant for cosmetic and non-structural work: kitchens, baths, flooring, paint, and mechanicals. The Standard 203K has no set cap and is required when the project involves structural changes, additions, or work that makes the home temporarily uninhabitable. It also requires a HUD consultant.
Why most contractors avoid 203K
A 203K job pays through a draw schedule, not all at once. The contractor fronts labor and materials for each phase, then gets reimbursed after a HUD inspection confirms the work. That cash-flow reality, plus the documentation, scares off contractors who are not set up for it. It is exactly why having a contractor who specializes in 203K matters: they plan around the draws instead of stalling when the money is not instant.
Questions to ask before you sign
Ask how many 203K projects they have actually completed, not just bid. Ask whether they have worked with a HUD consultant before and can recommend one. Ask how they handle change orders when hidden conditions show up, because in an older Detroit home, they will. And ask to see a written, line-item scope of work, because the lender will require one and a vague estimate is a red flag.
How Arise Above handles it
We specialize in 203K renovation loans across Metro Detroit. We help you scope the project so it fits the loan, coordinate with your HUD consultant and lender, and sequence the work so structural and safety items come first. You get one accountable point of contact from offer to move-in.