Renovation Home Loan Options
Renovation home loans, renovation mortgages, home improvement loans and home repair loans can be terms used interchangeably to include several types of home loans and mortgages. With these phrases being used by different lenders and mortgage companies to mean different things, it can be difficult to find the type of renovation home loan that's right for you on your own. Contact Cleveland Mortgage anytime for a free consultation, or just some help figuring out what type of renovation, rehab or home improvement loan makes the best sense for you.
Whether you are purchasing a home that needs repair, or you already own a home that you would like to renovate, will help determine which renovation loan you would qualify for.
Renovation Loans with Home Purchase: FHA 203(k) Rehab Loan
At Cleveland Mortgage we offer all types of home loans for renovations and rehab. The most well-known renovation home loan for home buyers is an FHA 203(k) rehab loan, a purchase loan that allows the home buyer to finance costs of renovations into the purchase price. As with all home loans there are many things to consider to determine whether or not this is the best renovation home loan for you. Would a streamline 203(k) loan be the better fit for your home purchase loan or a standard 203(k) loan? Will your contractors have the work complete in under 6 months? Are your renovations less than $35,000? These factors, as well as credit score, debt-to-income ratio and other qualifying factors help to determine which renovation loan fits your situation.
Renovation Home Loan Purchase: Conventional Rehab Loan
There are also conventional rehab loans to consider like Fannie Mae's HomeStyle Renovation Mortgage and Freddie Mac's CHOICERenovation loan. Where the FHA 213(k) rehab loan is a renovation home loan limited to primary residences only, conventional rehab loans can be used to finance renovations for investment properties and second homes. Each renovation home loan product has their own pros and cons, as well as qualifying factors. The local loan officers at Cleveland Mortgage will help determine which home loan you qualify for and which one will be best for your situation. Contact us for a free, no-pressure, consultation about your rehab loan options.
Conventional Loans and 203k (FHA)
- Combine purchase price with renovation costs
- Renovation costs limited to 50% of estimated future value of the home
- Appliances and luxury items can be included in most cases