Renovation Loans

Renovation loans allow borrowers to wrap the cost of repairs and improvements into their home financing. This loan option is ideal for borrowers who are interested in buying property that needs repairs or would benefit from remodeling. It’s also ideal for homeowners who need funds to rehabilitate, remodel, or improve their current property. If you are looking to construct a new home, consider one of our Construction Loans.

203(k) Rehabilitation Loans

There are two types of 203(k) loans, both offered by the FHA.

Streamline 203(k): This is a loan restricted to repairs or improvements that total to $35,000 or less. It can be used for electrical and plumbing, furnace and AC, a finished basement, updated kitchens and baths, paint, carpet, floors, roofing, siding, and windows.

Full 203(k): This loan allows more money to go towards renovation. It can be used for room additions, attached garages, or all streamline repairs.

Features

  • Property must be owner-occupied
  • Minimum of 3.5% down payment, calculated from the appraised value plus the cost of renovations
  • Loan amount must fall within FHA loan limits
  • Require a minimum of $5,000 to be spent on rehabilitation of the home.
  • Some restrictions on the types of repairs that can be done.

HomeStyle® Loans

Fannie Mae HomeStyle® Renovation Loans allow more of the loan amount to go into repairs or improvements and more types of improvements are eligible.

The cost of renovations, repairs, or improvements can equal up to 50% of the “as-completed” value of the property. The “as-completed” value is the market value of the home, factoring in the improvements and renovations. The renovation loan can only be used toward repairs or renovations that are permanently affixed to the property and improves the value of the property.

Features:

  • Can be used on a primary home, second home, or investment property
  • Minimum of 5% down payment, calculated from the appraised value plus the cost of renovations
  • Loan amount must fall within FHA loan limits
  • Any renovation is allowed as long as it is attached to the real property

To learn more about our Home Renovation Loans, contact our Cliffco Mortgage Bankers loan specialists at (516) 231-1654 or email info@cliffcomortgage.com. We are licensed in New York, New Jersey, Pennsylvania, Connecticut, Florida, Texas and the US Virgin Islands. Each one of our licensed experts can help answer any questions you might have, guiding you every step of the way through the loan process. We look forward to hearing from you!