An Affordable Way to Finance Your Dreams.
The Renovation Mortgage can help you purchase your new home, and finance the renovation costs—all in one loan, with one loan closing. Conventional or FHA underwriting guidelines apply. You can even refinance your current home and use the Renovation Mortgage to pull cash out to remodel/renovate without having the penalties of a ‘cash-out’ refinance.
Is The Renovation Mortgage Right for You?
If these situations describe you, the Renovation Mortgage might be a good fit:
• You are purchasing a property that needs either minor or major repairs, and would like to finance the renovation project.
• Your current home needs repairs/renovation, and do not have much cash on hand to repair the property.
How the Renovation Mortgage Works:
In a purchase transaction, the Renovation Loan will allow you to finance the new home, and also sets up an escrow account for the repair costs—all in one loan. You go to only one loan closing, and the renovation funds get deposited into a separate escrow account. As the work is completed by an approved contractor, the funds are dispersed to them. At the end of the renovation (no longer than 6 months), any excess funds are used to pay down the existing mortgage. Inspections are performed throughout the renovation, to assure all the work is performed in a workmanlike manner.
The value used for loan calculations is the purchase price plus renovation costs, or appraised value after completion, whichever is lower.
The Renovation mortgage is available on Primary Residences, Second Homes, and Investment Properties.
The Renovation Loan is for fully-documented income borrowers only, and is underwritten by conventional guidelines, and can be used in any amount of renovation, as long as the work to be completed will increase the value of the property (per the ‘subject to’ appraisal).
To Find Out More:
Simply ask us for more information about the Renovation Mortgage.