The Perfect Home, If It Just Had A...

Posted by David Blackmon on Wednesday, February 11th, 2015 at 10:10am.


Renovation Mortgages

How often do we find ourselves looking at a home and imagining the possibilities? “This house would be perfect if it only had “_______”. It could be a new kitchen, more bedrooms/bathrooms, or even a complete remodel. When most of us look at a home, we envision ourselves in it and how we would want to live on the property.

Figuring out how to make home improvements into a reality can be difficult. It’s hard enough for most of us to save up for a down payment on a home, let alone for the costs of a remodel too.  So how can you affordably make these improvements? The solution is Renovation financing.

Renovation mortgages allow for the purchase or refinance of a home, along with the costs for the home improvements to be rolled into one new mortgage.

Key features of renovation home loans

  • The buyer/owner includes the cost of all renovations in their loan to customize, improve, and modernize their home. *(repair budget is determined by loan program and property value)
  • Improvements can be small cosmetic repairs & updates, to a major remodel or addition
  • Similar qualifying requirements as any FHA, Conventional or VA loans
  • Appraisal is based on “after improved” value 

Types of repairs or renovations that can be done with renovation mortgages

  • Flooring
  • Cabinets
  • Countertops
  • Plumbing, Electrical, AC
  • Additions, Decks, Patios
  • Energy Efficiency Upgrades

For buyers

Home renovation loans can increase the range of homes available. If you are shopping in a competitive market, chances are if a home is listed for sale with the location, price and with the features you want, there are likely multiple offers, or in some cases it may sell before it even hits the open market. Buyers who are qualified for a renovation loan are able to search for a broader base of homes in their market; now, that home that was in the right area, in the right price range but just didn’t have enough space or needed serious updating is now a viable option with a renovation mortgage.

For current homeowners

Home renovation loans allow them to make the changes they have always wanted to the home they already own. Maybe your family has outgrown what was once a “spacious” two bedroom bungalow? Maybe it’s finally time to scrap that old heating system and install the rest of those energy efficient upgrades your old house desperately needs? A renovation loan can make your current home the dream home you knew it could be.

Renovation loan options                

There are renovation loans for nearly every type of customer. Fannie Mae offers the HomeStyle renovation loan, a conventional loan that allows for financing up to 95% of the future appraised value. FHA offers their 203k renovation loan, which only requires a 3.5% down payment. VA offers veterans a renovation loan option for 100% financing of the home and its repairs and upgrades. Each of these loan programs has its own credit requirements and underwriting guidelines, depending on the size of your renovation project and your individual qualifications. Speaking with a loan officer that specializes in renovation financing will help you narrow down which renovation loan is right for you. 

Author: David Blackmon

David Blackmon is a Senior Loan Consultant with iMortgage in Bend, Oregon. He has been a Loan Officer specializing in residential purchase, refinance and construction financing for over 12 years. 

David Blackmon – Senior Loan Consultant - NMLS ID  1017565 – Direct: (541) 977-1953 Cell: (503) 701-7653 -

   NMLS ID 174457   

imortgage - 44 NW Irving Ave. - Bend, OR 97701 | Rates, terms, and availability of programs are subject to change without notice. Licensed by the OR Division of Finance and Corporate Securities, Mortgage Lending ML-4972. Corporate NMLS ID 174457. All rights reserved. 

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