ROCKY MOUNT, N.C. - Centura says it is the first North Carolina bank to offer a home mortgage that provides borrowers with financing to fix up their homes or buy existing houses in need of repair.

The federally backed program, called the FHA 203(k) loan, differs from other mortgages by giving consumers the ability to buy and renovate a home through a single loan.

Such a loan also can be used to refinance debt on an existing property and is available for investors as well as owner-occupants.

"No other mortgage program in North Carolina offers this much flexibility and convenience," said Larry Byrd, who manages Centura's program. The mortgage "is perfect for the qualified, first-time homebuyer, who can assume an existing 203(k) loan with no down payment," he added.

Mr. Byrd said the 203(k) was also useful for homeowners who want to rehabilitate an existing home or sell properties in need of repairs.

The FHA 203(k) is administered by the Federal Housing Administration and insured by the U.S. Department of Housing and Urban Development.

With an FHA 203(k) loan, investors can rent or sell after rehabilitation, convert nonresidential property into housing with one to four units, or move an existing house to a new site. The program features a low down payment, one closing, and a fixed-rate loan, according to Centura.

"You can buy a rundown four-unit dwelling, renovate it to HUD's standards and live in one unit and rent the others out. Or an investor can buy and renovate a property and then sell it for a profit."

Each loan is based on the value of the property after improvements are finished.

The rehabilitation money can be used for any improvement, from shoring up a foundation to adding a bathroom or updating a kitchen.

Robert R. Mauldin, chairman of Centura Banks Inc., said Centura would work closely with local governments to aggressively locate eligible properties.

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