The difference between 203k and Title 1 lies in the scope of improvements that can be made with each type of loan. The 203k loan is an FHA-backed renovation mortgage that allows borrowers to borrow additional funds for both the purchase price of the home and its renovation costs. This loan program is specifically tailored to cover major repairs or renovations, such as structural repairs, remodeling kitchens or bathrooms, adding room additions, or replacing HVAC systems. In contrast, the Title 1 loan is intended for smaller-scale improvements and repairs that enhance the livability of a property rather than undergoing extensive renovations.