The 203k loan is a FHA program offering loans to make improvements to an existing property. 203k loans can be used to completely re-construct a home or for home additions, remodeling or simple upgrades. These loans can also be used to finance the cost of demolishing an existing foundation so you can build a new structure on all or part of the existing foundation. This type of loan is used mostly when the value of the home in its current condition is inadequate to serve as collateral or security for the financing needed to renovate the home. Considerations regarding this type of loan include the fact that many lenders do not offer these programs or do not offer them at competitive terms and rates, and that you must be able to demonstrate that the value of the home after the renovations is adequate to secure the loan.