Renovation Loans
When a homebuyer wants to purchase a house in need of repair or modernization, the homebuyer usually has to obtain financing first to purchase the dwelling; additional financing to do the rehabilitation construction; and a permanent mortgage when the work is completed to pay off the interim loans with a permanent mortgage. Often the interim financing (the acquisition and construction loans) involves relatively high interest rates and short amortization periods. The renovation loan program was designed to address this situation. The borrower can get just one mortgage loan, at a long-term fixed (or adjustable) rate, to finance both the acquisition and the rehabilitation of the property. To provide funds for the rehabilitation, the mortgage amount is based on the projected value of the property with the work completed, taking into account the cost of the work.
In addition to renovation loans for new home purchases, we also offer a refinance renovation option for homeowners who want to improve their homes but don't have the equity now. Just as with the purchase program, the mortgage amount is based on the projected value of the property upon completion of the work. In other words, even if the equity is not there now, we can lend funds based on the equity that will be there once the renovations are complete.
In addition to renovation loans for new home purchases, we also offer a refinance renovation option for homeowners who want to improve their homes but don't have the equity now. Just as with the purchase program, the mortgage amount is based on the projected value of the property upon completion of the work. In other words, even if the equity is not there now, we can lend funds based on the equity that will be there once the renovations are complete.
