My first question would be what kind of contractor are you? Then, is that the kind of contractor that's needed on this project?
If your project requires a general contractor, and you are a general contractor, then you likely can do your own work. But do you really want to? I know it sounds like a good idea because you think you can save yourself money. In reality it takes you away from what makes your money.
Your project will take a backseat to every other paid job you get a chance to work on. I'm sorry, that's just the blood reality of it. You also have the paperwork nightmare. The lender will require you to keep very careful records as to who you paid for what, much more than if you just were contractor on someone else's 203K project. You will never be paid for your own labor.
The good thing is you can get paid for labor paid out to others, but you have to prove it.
If you want to do self-help and be your own contractor, and put up with all the paperwork, we still have to create a scope of work with enough money, labor and materials, to complete the project with a different contractor. This is done just in case you flake out on us and don't get the job done in a timely manner. We will then have the money set aside to complete your project in spite of you. So what have you really gained? Your borrowing the money to complete the project. You complete the project and don't get labor for yourself. The extra money pays down on your mortgage, but your payment doesn't change. What have you really gained? Was it worth it?
So you had a $100,000 project, and you saved your 20% profit and overhead. You're fooling yourself, because the overhead was still there, and you worked for free. In reality you save maybe 10% which would your profit on this project. You didn't save any overhead because it cost you to hire people and manage them. So you put yourself through all of this extra work for nothing. Had you taken on another job that would've paid you labor and materials you likely would've been better off. Then you and your spouse could have been angry at the contractor who didn't finish the work on time, and you to can be on the same side, the winning side of this project. On the other hand had you done the work your self, your spouse is the only one that can be angry at the contractor, and who is the contractor? YOU!
To learn more about the FHA 203k loan program go to www.203kOnLine.com. To contact us for a consultation please go to www.my203kconsultant.com and "order a consultation".