How Renovation Loans Can Help Home Buyers Find A House Faster In Today’s Market.

Are you considering purchasing a fixer-upper or a property that needs repairs? Renovation loans may be the solution you’ve been looking for. Not only do they allow you to finance the cost of renovations along with the purchase price of the home, but they also make more houses available on the market for homebuyers. In this blog post, we’ll discuss the differences between four popular types of renovation loans: the Fannie Mae Homestyle loan, FHA 203k loan, VA Renovation Loan, and Freddie Mac ChoiceRenovation loan. 

Types of Renovation Loans

Using a renovation loan to purchase a fixer-upper or a property that needs repairs can make more houses available on the market for homebuyers. These homes are often priced lower than move-in ready homes, giving buyers an opportunity to purchase in areas that may have been out of reach. By updating and improving the property, you can also increase its value, which is beneficial for the real estate market as a whole. Now, let’s take a closer look at the four most popular types of renovation loans:

Fannie Mae Homestyle loan:

The Fannie Mae Homestyle loan is a conventional renovation loan that allows borrowers to finance up to 75% of the home’s value after renovations have been completed. Borrowers have the flexibility to hire their own contractors and complete the renovations on their own timeline. The Homestyle loan is a good option for borrowers with good credit and a significant down payment.

FHA 203k loan:

The FHA 203k loan is a government-backed renovation loan that can be used for both purchase and refinance transactions. This loan allows borrowers to finance up to 110% of the home’s value after renovations have been completed. All renovations must be completed by a HUD-approved contractor, and the loan has specific requirements for the types of repairs and renovations that can be completed. The FHA 203k loan is a good option for borrowers with lower credit scores and a smaller down payment.

VA Renovation Loan:

The VA Renovation Loan is a government-backed renovation loan that is available to eligible veterans, active-duty service members, and surviving spouses. This loan allows borrowers to finance up to 100% of the home’s value after renovations have been completed. All renovations must be completed within 90 days, and the loan has specific requirements for the types of repairs and renovations that can be completed. The VA Renovation Loan is a good option for eligible borrowers who are looking to purchase a home that needs repairs.

Freddie Mac ChoiceRenovation Loan:

The Freddie Mac ChoiceRenovation loan is a conventional renovation loan that allows borrowers to finance up to 75% of the home’s value after renovations have been completed. Borrowers have the flexibility to choose from a variety of financing options, including fixed and adjustable-rate mortgages. The ChoiceRenovation loan is a good option for borrowers with good credit and a significant down payment.

At MacLagan Home Loans, we specialize in renovation loans and can help you navigate the process. Our experienced team can guide you through the application and approval process, helping you choose the loan that best fits your needs. We can also help you understand the specific requirements of each loan and provide guidance on the types of repairs and renovations that can be completed. With MacLagan Home Loans, you can rest assured that you’ll have the support and expertise you need to successfully complete your renovation project.

Check out Our Youtube Video of this blog post!

In conclusion, renovation loans can be a great option for homebuyers who are looking to purchase a fixer-upper or a property that needs repairs. The Fannie Mae Homestyle loan, FHA 203k loan, and Freddie Mac ChoiceRenovation loan are three of the most popular types of renovation loans available, each with their own unique benefits and requirements. Contact MacLagan Home Loans today to learn more about how we can help you get the renovation loan you need to turn your dream home into a reality.