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Refinance | Remodel

Refinancing with a renovation loan can be a terrific option these days due to the virtual disappearance of constructing lending. Subject to the local county lending limit, a renovation loan pays off the existing mortgage and provides a budget for renovation costs. The types of renovation loans: The FHA 203(k) Streamline and Full 203(k) (FHA) and Energy Improvements can all be used for purchase or refinance to cover the renovation costs of your existing residence. The Home Style (Fannie Mae) loan can also be used for an investment property. The refinance of a home with a Renovation Loan allows the owner to add a budget for renovation costs to the existing loan balance of the home. After close, the funds are used to complete planned improvements to the home. This is perfect should you want to repair or update your home or buy a “new to you” home that is in need of repairs or customization. Finding the “almost perfect” home is a challenge enough .. now you can make it the perfect home.  Or, rather than buying another home, you can fix up and customize your current home
  • Loan amounts up to 96.5% of the improved value of the home
  • Estimates for the work to be completed must be obtained and approved as part of the loan process prior to closing
  • Work must be completed within 6 months
  • Renovation budget must include a 10%-20% contingency reserve depending on the type of work
There are two types of FHA 203k renovation loans … Streamline where the cost of repairs is less than $35,000 and Standard, where the loan limits are designated by County.  Each of these can be supplemented by energy improvement loan over and above the designated limits Cost of a 203k renovation loan include costs associated with any FHA loan
  • Up Front Mortgage Insurance of 1.75% (can be added to loan amount above the County limits)
  • Monthly mortgage insurance 0.85%
Additional costs include inspection fees, appraisals, title inspection, etc.