Homestyle Renovation Loans are commonly used to upgrade a home in need of repairs during or right after the initial purchase. While it is not the sole way to pay for the renovations, many find ease of use in this program, since it can be rolled in with the home purchase mortgage. Learn more about Homestyle Renovation Loans in this week’s blog post from Nickel City Funding in Orchard Park, NY.
What is A Homestyle Renovation Loan?
Do you have your eyes on buying a home, but find that you do not have the access to cash to make all the upgrades and renovations you need? This is where you may want to consider a Homestyle Renovation Loan. Fannie Mae offers this program, and it can combine into the mortgage when you go to finance the home. Your financing can be determined based off the value of the home after the repairs are made, which makes it easier for you to qualify.
Eligibility for Homestyle Renovation Loans
Beyond a review of your personal finances, the home you plan to renovate will also need to go through approvals. Fannie Mae lists that you may only work with eligible contractors and architects with this program, and they will review the budgets closely. In fact, anyone contracting with the deal may need pre-approval. Lenders will also look for adherence to timelines in your project. They want to ensure they are done within six months after close, or 100 days for energy upgrades.
Prior to paying, you may need to have an appraiser confirm the home value after repairs are completed. This program is only eligible for use in certain homes, manufactured and mobile homes do not qualify. However, both businesses and individuals can apply for a Homestyle Loan.
Perks Associated with Homestyle Renovation Loans
Besides raising the value of your home, there are many other perks associated with using a Homestyle Renovation Loan. Lots of people use it to pay for energy upgrades, which translates into savings on your utility bills. You can also pay for items beyond just construction, for example, if you need to pay for any permits or inspectors. You will also avoid paying two closing costs if you can roll it into your existing mortgage.
Most importantly, by having a greater value home, you will build equity more quickly, and may even be able to benefit should you decide to sell the house. Nickel City Funding enjoys helping clients in Orchard Park, NY help cover the cost of repairs and renovations. Learn more about using a Homestyle Loan to beautify and get more use out of your future home. Contact our friendly, knowledgeable team for a quote today.