Home Renovation Loan

Home Renovation loan

Renovation Loans can be a valuable option for borrowers who want to purchase a home in need of repairs or renovate their current home. Here are 2 types:

Homestyle Renovation Loan

This is a type of mortgage that allows borrowers to finance both the purchase of a home and the cost of renovations or repairs into one loan. This type of loan is often used by homebuyers who are interested in purchasing a fixer-upper or by homeowners who want to renovate their existing homes.

Here are some key features of a homestyle renovation loan:

  1. Purchase and Refinance Options: With a homestyle renovation loan, borrowers can finance both the purchase price of the home and the cost of renovations or repairs. Can also be used to refinance renovations in an existing home.
  2. Single-Close Loan: Unlike traditional mortgages and renovation loans, which often require separate closings, a homestyle renovation loan is a single-close loan. This means that the loan funds for both the purchase and renovation are disbursed at the same time.
  3. Renovation Budget: Borrowers must provide a renovation budget detailing the planned improvements and their associated costs. This budget helps determine the total loan amount and ensures that the renovations are feasible.
  4. Property Eligibility: Not all properties are eligible for homestyle renovation loans. Generally, the property must be a one- to four-unit primary residence, a one-unit second home, or a one-unit investment property.

FHA 203K Loans

The FHA 203(k) loan is a type of mortgage insured by the Federal Housing Administration (FHA) that enables borrowers to finance both the purchase or refinance of a home and the cost of renovations or repairs into one loan. This loan program is particularly beneficial for individuals looking to purchase fixer-upper properties or homeowners seeking to renovate their existing homes.

Here are some key features of FHA 203(k) loans:

  1. Purchase and Refinance Options: The FHA 203(k) loan program offers both purchase and refinance options. Borrowers can use the loan to purchase a home in need of repairs or refinance their existing home and include renovation costs in the new loan.
  2. Financing for Renovations: FHA 203(k) loans allow borrowers to finance a wide range of renovations or repairs, including structural repairs, room additions, kitchen and bathroom remodels, flooring, roofing, plumbing, electrical work, and more.
  3. Single-Close Loan: Similar to the homestyle renovation loan, FHA 203(k) loans are single-close loans, meaning that the loan funds for both the purchase or refinance and the renovation are disbursed at the same time.
  4. Streamlined and Standard Options: There are two types of FHA 203(k) loans: the streamline 203(k) and the standard 203(k). The streamline 203(k) is designed for less extensive repairs with a maximum loan amount of $35,000, while the standard 203(k) accommodates more significant renovations without a maximum loan limit (subject to FHA loan limits in the borrower's area).
  5. Property Eligibility: Eligible properties for FHA 203(k) loans include one- to four-unit owner-occupied homes.

Follow Home Loans With Steve On Social Media

Licensing

Stephen Robidoux
Home Assist Coordinator and Sr. Loan Officer
NMLS ID: 21247
Lendmark Mortgage Corporation
NMLS ID: 1135
Serving MA, NH, CT & RI

Equal Housing Lender

Contact Us

Home Loans With Steve
400 Tradecenter Drive Suite 5900
Woburn, MA 01801

Number:
(978) 505-0245

Hours:
MON-FRI 7AM - 4PM