Which of the following types of property can be purchased with an FHA 203b loan?

Rationale

A four-unit, owner-occupied building can be purchased with an FHA 203b loan.

The FHA 203b loan program is designed to help individuals purchase residential properties, including multi-family units, as long as one of the units is owner-occupied. This makes it a suitable option for buyers looking to invest in a property while living in one of the units.

A (a farm that has a tenant) YOUR ANSWER

FHA 203b loans are intended for residential properties rather than agricultural ones. A farm, especially one with a tenant, does not fit the primary purpose of the FHA program, which is to provide financing for housing, making this option ineligible.

B (a four-unit, owner-occupied building) CORRECT

This choice aligns perfectly with the FHA 203b loan provisions. The loan can be used to finance a multi-family building with up to four units, provided the owner resides in one of those units, thus meeting the program's requirements for residential occupancy.

C (an apartment complex) YOUR ANSWER

While FHA loans can cover multi-family housing, the term "apartment complex" generally refers to larger residential buildings with multiple units not limited to four. Such properties typically do not qualify under the FHA 203b loan program, which restricts financing to smaller, owner-occupied buildings.

D (vacant land) YOUR ANSWER

FHA 203b loans are strictly for the purchase of residential properties with the intent to inhabit. Vacant land does not qualify because it does not serve as a residence, thus falling outside the scope of the FHA loan program.

Conclusion

The FHA 203b loan program is specifically designed to assist in the purchase of residential properties, particularly those that are owner-occupied. Among the choices provided, only a four-unit, owner-occupied building meets the criteria for financing under this program, while the other options involve properties that either do not qualify or do not meet the residential housing requirement.

Which of the following types of property can be purchased with an FHA 203b loan?

A four-unit, owner-occupied building can be purchased with an FHA 203b loan.

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