FHA 203k and Homestyle Renovation
203(k) and HomeStyle Renovation Loans to Revitalize a Home You’ll Love
If you are thinking of renovating your home, you want the best loan rates available. Olivia Reese – Sovereign Mortgage offers the most competitive renovation loans in the area. FHA 203(k) and HomeStyle® Renovation loans are two amazing financing options that allow you to borrow on the appraised value of a home after it is improved, which means more money for renovations up front. Our mortgage team will work closely with you to educate you on the differences in renovation financing. Contact us if you live in West Volusia County or surrounding Florida and schedule an appointment today.
FHA 203(k) Loans
FHA Standard 203(k) loans from the FHA are insured through the Federal Housing Administration. They allow homebuyers and homeowners to receive a loan at a reasonable rate for the purchase or refinance of a home and to pay for renovations. Renovations must include structural improvements that increase the home’s value long-term, such as structural improvements. Essentially, this type of loan combines financing for purchase and rehabilitation into a single contract. FHA standard 203(k) loans are sometimes called FHA construction loans or FHA rehab loans. 203(k) loans originate the purchase price of the property or value and the cost of renovation up to a maximum of $275,665 for a single-family home.
Streamlined 203(k) loans are like standard 203(k) loans, but are designed for lower-cost minor repairs or upgrades. They allow up to $35,000 for improvement of the property being financed. This type of rehabilitation loan makes sense for people who are interested in making non-structural repairs like painting, heating or plumbing repair or replacement, weatherization and more.
Both streamlined and standard 203(k) loans are available with variable term fixed and adjustable rate options. They may be used to purchase 1-4-unit homes and single-family homes, and have a minimum down payment of 3.5% of the estimated sale price and renovation cost. They require mortgage insurance.
The HomeStyle Renovation mortgage allows borrowers to purchase or refinance a home and make repairs or renovations totaling up to 50% of the estimated value of the home with the completed renovations. Like FHA 203(k), this loan allows borrowers to include purchase and renovation in a single-close loan. HomeStyle Renovation loans are provided through private lenders, but ultimately secured through the government-sponsored entity Fannie Mae.
HomeStyle Renovation loans may be used for 1-4-unit primary residences or to purchase single-unit investment properties. Down payments range from 5% (with management approval) to 20% (for investment property). Mortgage insurance is required until 20% of the HomeStyle loan value is paid off.
The Right Renovation Loan for Your Needs
Our mortgage professionals will help you compare 203(k) and Homestyle Renovation options to determine which best suits your goals as a homeowner. To learn more about different renovation financing options, contact Olivia Reese – Sovereign Mortgage. We help clients in Volusia County, FL.