Renovation Loans

Program Overview

Renovation Loans provide specialized financing for home renovations and improvements. These programs are designed for homeowners who want to update their existing home or buyers who want to purchase a fixer-upper and renovate it to their specifications.

How It Works

Instead of getting a separate mortgage and renovation loan, this program combines both into one transaction. You can finance the purchase price plus renovation costs, or refinance your existing home to include renovation funds.

Key Benefits

• One-Time Close: Single closing for purchase and renovation
• Higher Loan Amount: Finance purchase price plus renovation costs
• Competitive Rates: Rates comparable to conventional loans
• Flexible Renovations: Various types of renovations allowed
• Streamlined Process: Simplified underwriting and documentation

Program Requirements

Credit Requirements

• Minimum Credit Score: 680
• Credit History: Good credit history required
• Credit Inquiries: Limited recent inquiries preferred
• Payment History: No recent late payments

Renovation Requirements

• Detailed Plans: Complete renovation plans and specifications
• Renovation Budget: Detailed cost breakdown and timeline
• Licensed Contractor: Experienced, licensed contractor required
• Permits: All necessary building permits must be obtained
• Renovation Types: Cosmetic, structural, and major renovations allowed

Income Requirements

• Stable Employment: Minimum 2 years of stable employment
• Income Verification: W-2s, pay stubs, or business documentation
• Income Stability: Demonstrated ability to maintain income
• Debt-to-Income: Maximum 43% DTI ratio

Property Requirements

• Property Types: Existing homes, fixer-uppers, properties needing updates
• Occupancy: Primary residence, second home, or investment property
• Location: All 50 states
• Property Condition: Must be structurally sound

Down Payment Requirements

• Minimum Down Payment: 20%
• Source of Funds: Must be properly documented
• Gift Funds: Allowed with proper documentation
• Asset Verification: Down payment source must be verified

What to Expect

Step 1: Renovation Planning

We'll review your renovation plans and budget to ensure the project is feasible and properly planned. This includes analyzing costs, timeline, and contractor qualifications.

Step 2: Contractor Approval

We'll verify your contractor's credentials, experience, and financial stability. The contractor must be licensed, insured, and have experience with similar projects.

Step 3: Loan Application

Complete the renovation loan application. We'll lock in your rate and approve the total loan amount including renovation costs.

Step 4: Renovation Process

During renovation, you'll make interest-only payments on the drawn amount. We'll conduct inspections and release funds as renovation progresses.

Step 5: Completion & Final Inspection

Upon completion and final inspection, the loan converts to a permanent mortgage with your locked-in rate.

Who This Program Helps

• Homeowners wanting to update their existing home
• Buyers purchasing fixer-upper properties
• Investors renovating properties for resale or rental
• Those wanting to customize their home to their specifications
• Buyers who want to avoid the hassle of separate loans