Create Your Dream Home With a Renovation Loan

Explore Your Options Today!

Why a renovation loan?

Fairway Independent Mortgage Corporation offers renovation home loan options that provide the financing for your dream home plus financing for the improvements needed!

Replace your roof plumbing and electrical or add new flooring repaint and update your kitchen and bathrooms. If your current or future home is in need of repairs, we can help you fix it up!

ELIGIBLE REPAIRS Non-structural Structural and non-structuralStructural and non-structural
MAX ALLOWABLE TOTAL RENOVATION BUDGET $35,000 No limit to max FHA loan limitsPurchase: Lesser of 75% of total acquisition cost or as-completed appraised value
Refi: 75% of the as-completed value
FICO 620 620620
TEARDOWN Not allowed Allowed (foundation to remain intact)Not allowed
PRIMARY RESIDENCE PURCHASE DOWN PAYMENT AND LTV* 3.5% (96.5% LTV)3.5% (96.5% LTV) 3% (97% LTV) for first-time homebuyers
5% (95% LTV) for non-first-time homebuyers
95% LTV if non-FNMA loan pay-off
ELIGIBLE PROPERTY TYPES 1- to 4-unit primary residence1- to 4-unit primary residence 1- to 4-unit primary residence
1- to 4-unit investment property
1-unit second home
ADVANCES AT CLOSE AND MATERIAL DRAWS 50% of the total bid can be advanced at close of the loan No advances and no material draws50% of materials budget can be disbursed after close
DRAW HOLDBACKS No holdbacks on draws 10% holdback on all draws except final draw10% heldback of the total bid paid out with final draw
RENOVATION COMPLETION TIME Within 6 months of the close dateWithin 6 months of the close dateWithin 6 months of the close date
BORROWER RELATED TO CONTRACTOR Nat allowed Nat allowedAllowed

With a renovation loan, you can roll the cost of financing or refinancing a home and repairs into one loan – saving you time and money.

Turn a Fixer Upper into Your Dream Home

Home Style Renovation Loan

You can use a HomeStyle renovation loan to cover costs of
repairs. remodels. renovations or energy-efficient improvements on a primary residence. a second home or an investment property. There are no required improvements or restrictions on the types of repairs allowed or a minimum dollar amount for the repairs. However, repairs or improvements must be permanently affixed to the real property. add value to the property. and be completed by a licensed contractor.

Limited 203(k) Rehabilitation Mortgage

In addition to funding your new home. an FHA Limited 203(k) can provide up to $35.000 (including a contingency reserve) in additional funds to help make a few non-structural repairs or renovations such as updating a kitchen or bathroom. adding new flooring. purchasing new appliances. or repairing the roof.

Standard 203(k) Rehabilitation Mortgage

If your potential dream home needs more than $35,000 in renovations or the repairs are structural, the Standard FHA 203(k) might be the right solution. This program removes the restrictions of the limited option to allow for major home remodeling. A Standard FHA 203(k) can provide additional funds’ to help with eligible repairs including moving or removing walls. minor pool repairs, and landscaping.

*Final disbursement of funds is subject to final inspection.

MYTH 1: “My Options Are Limited”

When it comes to renovation financing, there are more cans than cannots. White a Limited 203K is intended to remedy cosmetic deficiencies and maintain a total renovation budget of less than 35,000, the Standard 203K can support a project as robust as a teardoen and rebuild. Similarly, the HomeStyle renovation loan requires repairs that add value, are permanently affixed and do not exceed 50% of the after-improved value. Want a pool? You got it! An addition? We can do that too! Replace all mechanicals and upgrade flooring? There’s a renovation loan for that.

Remember, renovation loans cannot improve shared space of attached properties, increase unit count or complete new construction homes.

MYTH 2: “Closing Costs Are Higher”

In addition to the sales price, renovation loans use the after-improved value to finance what are called hard and soft home improvement costs into the loan amount. Your hard costs include bid, contingency reserve and ant escrowed mortgage payments the borrower elects to finance. Closing costs are not necessarily higher on a renovation loan. Renovation Soft costs are not closing costs.

MYTH 3: “I have to Be a Renovation Expert”

Since Fairway Independent Mortgage Corporation’s certified Loan Officers provide exemplary renovation expertise, you can relax knowing we’ll walk you through the entire process, making it as smooth as possible.

MYTH 4: “Renovations Loans Are for Primary Residences Only”

The 203K products follows FHA guidelines and require that homeowners occupy or escrow occupancy mortgage payments within 60 days of loan closing. The HomeStyle, however, allows prospective and current homes and investment properties in addition to the typical primary occupancy.

MYTH 5: “Limited K Loans Are Best”

The Limited 203K product has a of benefits including a 50% draw of eligible contractor funds at the closing table. However, there are qualities that make the product more difficult for prospective homeowners, especially when they are a first-time homebuyer. These difficulties include a limit on the cost and scope of projects, additional paperwork and higher expectations for the contractor’s written work narrative. The Standard 203K and homeStyle allow homeowners to finance the cost of a HUD consultant, who will outline the project in the agency-required format and deliver a fair representation of project scope and cost requirement.

MYTH 6: “It Will Take Too Long”

Delays usually only exist when the costs and projects change mid-transaction. In the case of any home loan closing, proper expectations, deadline awareness and communication are the key to on-time closing. Well-qualified borrowers with eligible contractor and a firm renovation direction at the time of offer generally close within 35 days of the loan application.

Get Your FREE Renovation Loan Quote Now!