If you are interested in buying a property that may be in need of some additional repair or upkeep, or if you already own a home and are interested in finding funding to afford renovations or a remodel, you may want to consider a homestyle loan, which is intended to help make home improvements on a new or refinanced home. If you are located in Orchard Park, New York, and interested in learning more about buying a new home in need of maintenance or renovating your existing home, Nickel City Funding, Inc. can help you determine the best financing option for your unique situation. Read on to learn more about how homestyle loans work.
Homestyle Loans: Essential Information
Homestyle loans are insured through the government and are intended to offer new homebuyers or current homeowners the opportunity to make improvements and renovations to either a newly purchased home or to the home that they already own. A homestyle loan includes both the funding for both the purchasing or refinancing of a home, plus the cost of renovations. The money that comes from a homestyle loan may be used for all types of renovations, including energy efficient improvements, bathroom, bedroom, and kitchen repairs, new painting, flooring, roofing, and landscaping. Homestyle loans typically have lower interest rates than a home equity line of credit, (HELOC), and other loan types, and the loan amount is based on the future amount your home will be worth after the renovations have been made instead of the current home value, increasing the the overall amount of money you will be able to borrow.
Advantages To Obtaining a Home Loan
There are several benefits to obtaining a homestyle loan. Most homestyle loans notably come with lower interest rates and down payment amounts, and making repairs and improvements to your property will increase the equity in your home. Another significant advantage to obtaining a homestyle loan is that borrowers who qualify are not required to pay for fees that are normally associated with purchasing a home, including closing costs. Homestyle loans also may be used to purchase multi-unit properties or vacation homes.
Eligibility Requirements For a Homestyle Loan
The typical requirements that are needed to qualify for a homestyle loan include:
- Repairs and improvements must be added to the property value
- A credit score of 640 or higher
- A down payment of at least 5%
- A debt-to-income ratio, (DTI), of 50%
Homestyle Loan Assistance
In certain situations, the home you are interested in owning may be in need of some upkeep and TLC. If you are interested in making improvements to your current home or buying a new property that needs some renovations in Orchard Park, New York, Nickel City Funding, Inc. can help. Contact our office today for a consultation.