Rehab & Renovation Home Loans
Create Your Dream Home with a Rehab Loan
Sometimes the best path to finding your dream home is to purchase a fixer upper and make it your own. It’s a thrilling undertaking. It’s a chance to put your own stamp on house. But the logistics of financing that project can feel complex.
Rosa Briggs and team is a proven expert in rehab home loans, and we’re pleased to help ambitious people navigate their remodel and renovation journey.
What is a rehab loan?
A rehab loan, also known as a renovation loan, is a single loan that combines a property’s purchase cost along with a bid for renovations into a single loan. It’s a loan designed to empower homeowners and homebuyers with the resources they need to transform properties into their ideal living spaces.
Whether you’re a homeowner looking to enhance your existing space or a homebuyer with a vision for a fixer-upper, a rehab loan offers the flexibility and support needed to turn houses into dream homes.
Available renovation loan programs
There are three primary renovation loan programs available. Your home lending team will work with you to identify which option is best for your goals. For now, here’s a brief overview:
- Conventional Loan (CHOICERenovation)
- Great for first time homebuyers and rural home buyers.
- Maximum renovation costs cannot exceed 75% of the after-improved value.
- Work must be completed by a qualified contractor. Owner assistance in the project is not allowed.
- FHA 203(K) Standard
- Best for major or more complex renovation projects that exceed $35,000 in costs.
- Total renovation costs are contingent upon the appraised property value.
- Work must be completed by a qualified contractor. Owner assistance in the project is not allowed.
- FHA 203(K) Limited
- Intended for smaller projects and largely useful for cosmetic repairs and updates.
- Total renovation costs may not exceed $35,000.
- Work must be completed by a qualified contractor. Owner assistance in the project is not allowed.
When does a rehab loan make sense?
Rehab or renovation loans are a great option for:
- Homebuyers who want to purchase and customize an existing house to fit their vision
- Homeowners who want to renovate or add an ADU to their current home to better fit their needs
- Seniors who need to make accessibility updates to their homes
Rehab loan standards and guidelines
It’s important to know that there are certain parameters attached to a rehab loan. Most importantly:
- The homeowners cannot do the renovation work themselves.
- Renovation work must be done by an approved professional contractor.
- Rehab loans only apply to primary residences. Rehab loans cannot be used for investment properties.
Get started
A home renovation is no small task, but your financing strategy doesn’t have to be complicated. Reach out to us today to discover how Rosa Briggs can help.
