Is your home falling apart? Are you looking to make updates to key rooms in your home? If so, you know that coming up with the necessary funds isn’t always easy. At First Fidelis, we like to encourage our clients to consider a home renovation loan.
With home renovation loans, you can take care of structural problems with your home or add on things that will make your life more enjoyable, such as a pool, fire pit, or deck. Many homeowners use home renovation loans to finish basements and add bedrooms onto their homes as well. No matter what type of project you are looking to take on, there is a home renovation loan for you.
What Is a Home Renovation Loan?
Renovating a home can be a costly endeavor. Many people need to consider loans to help cover the up-front costs associated with renovations. While you can get a personal loan to help pay for home renovations, this might not be the best avenue. Instead, home renovation loans might provide you with everything that you need to make sure your renovation costs are covered.
Home renovation loans can be applied in a couple of different ways. First, if you are purchasing a home that needs a little extra TLC upon move-in, you can get a loan that ties in with your mortgage loan. You can also just get a home renovation loan, of which there are many options, that is completely separate from your mortgage loan.
Types of Home Renovation Loans
There are numerous different programs that offer home renovation loans. Here are a few of the most popular:
FHA 203(k): FHA 203(k) loans are government-backed loans that are open to people with lower credit scores. However, mortgage insurance premiums are generally higher, especially without a significant down payment. An FHA 203(k) Full loan is great if you need to make significant repairs to your while, while an FHA 203(k) Streamline loan is best if you need to make repairs of less than $35,000.
Fannie Mae Homestyle: This is a single-close loan that includes the cost of the home repairs in your mortgage loan. A Fannie Mae Homestyle loan can be used for repairs that are required by an appraiser or changes that the homeowner wishes to make. These loans can be used for both structural and cosmetic repairs. With this type of loan, you only have to worry about one loan and payment, and generally, interest rates are a bit lower than with other renovation loans.
EZ “C”onventional: EZ “C”onventional loans can be used with conventional mortgages for cosmetic home repairs that add value to the property. This type of loan can be used for both appraiser-required and borrower-selected renovations.
Jumbo Renovation: Much like the EZ “C”onventional loan, Jumbo Renovation loans can be used for non-structural repairs. These loans are reserved for higher-priced homes that wouldn’t be covered by other home renovation loans.
USDA Rural Development Home Repair Loans: Through the USDA Rural Development program, homebuyers can get financial assistance to buy a safe, decent home. These loans can be used to get new appliances, foundations, roofing, windows, siding, plumbing, electrical, and other necessary upgrades for health and safety reasons. Eligibility is based on income and rural location.
VA Renovation Loans: VA Renovation loans are made for veterans or active duty military members who need to spruce up a home that otherwise wouldn’t meet minimum property standards to qualify for VA financing. These loans can be used to fix problems with the property with no down payment.
If you are looking for a home renovation loan in the Kansas City Metro Area, First Fidelis can help. We work with 17 different lenders to help you secure the best deal on the loan that you need. To get started, call us today at 913-205-9978.