Renovation Loan

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A home renovation loan can be used for purchase or to refinance and may be the right solution whether you’d like to renovate or remodel your current home, or you’ve fallen in love with a fixer upper.

By rolling the cost of financing or refinancing your home and improvements into one loan, a renovation loan can save time and money.

Benefits of Renovation Loans

A renovation loan can help you create your dream home!

  • Simplicity – include the purchase (or refinance) and improvements in a single mortgage.
  • Flexibility – from cosmetic changes (including landscaping) to structural repair.
  • Affordable – interest rates are typically lower than a HELOC, personal loan, or credit cards.
  • Loan to value is based on the value of the improved property.
  • A solution to purchase a new home that needs repairs.
  • Greater enjoyment of your home while improving property value.
  • Some repairs can save you money in the long run, improve energy efficiency, or make your home safer.

Renovation Requirements

There are program specific requirements for renovation loans, some of these are:

  • FNMA Homestyle loans have qualification requirements like conventional loans, making this a great option for borrowers with stronger credit. Homestyle loans must be permanently affixed to the property, add value, and be done by a licensed contractor. This loan can be used for a second home or investment property, and there are otherwise no restrictions on the type of improvements.
  • FHA 203K loans are a government backed option and have qualification requirements similar to other FHA loans. This government backed option can be used only for a primary residence, has stricter guidelines for improvements, and requires mortgage insurance. There are two types of 203K loans; Standard – generally used for large structural repairs costing more than $35,000; or Limited – generally used for cosmetic changes costing less than $35,000.

Finance your home improvements with Fairway of the Rockies

Fairway has a team dedicated to renovation loans, and the experience needed to ensure a smooth experience. Discuss your options with one of our loan officers. Your first step is to get pre-qualified with our easy pre-qualification form.