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Home Improvement & Renovation Loans

Conventional
Type	Best for	Advantages
HomeStyle®	Older homes in established neighborhoods Appraiser-required or borrower requested repairs that add value to the home	Fewer costs by rolling repairs purchase/refinancing expenses into a single loan
EZ “C”onventional	Covers appraiser-required or borrower requested repairs Finance small upgrades on a newly purchased home over a short period of time Cosmetic, non-structural improvements	Creates dedicated account to cover costs of updates Fewer costs by rolling updates and purchase/refinancing expenses into a single loan
Buyer/Seller Funded Repair Escrow	Borrower-requested repairs or other home updates that will determine final appraisal	Creates dedicated account to cover costs of updates Funds can be provided by the buyer or seller Fewer costs by rolling construction and purchase/refinancing expenses into a single loan
Jumbo Renovation	Covers appraiser-required or borrower requested repairs on high-priced luxury homes that are valued over $484,350 Can be used for refinancing or home purchase	Covers a dedicated account to cover non-structural repairs up to $250,000 Fewer costs by rolling repair and purchase/refinancing expenses into a single loan
Pool Escrow	Adding a pool	Creates dedicated account to cover cost of pool construction Fewer costs by rolling construction and purchase/refinancing expenses into a single loan
Weather-Related Escrow	Repairing weather damage Making weather-realted or energy efficient upgrades	Creates dedicated account to cover cost of repairs or upgrades Fewer costs by rolling construction and purchase/refinancing expenses into a single loan

Government-insured
Type	Best for	Advantages
FHA 203k Full/Standard	Refinancing or buying older properties Refinancing or buying a home requiring structural repairs or major renovation	Low down payment requirement on new home purchase Low refinancing interest rates Fewer costs by rolling repair and purchase/refinancing expenses into a single loan
FHA 203k Streamline	Refinancing or buying a home that needs updating or repairs Cosmetic repairs, remodeling up to $35,000	Low down payment on new home purchase Low refinancing interest rates Less paperwork Fewer costs by rolling repair and purchase/refinancing expenses into a single loan
HUD REO with Repair Escrow	Purchasing a foreclosure home Foreclosed properties requiring minor repairs up to $5,000	Creates dedicated account to cover appraiser-required repairs Fewer costs by rolling repair and purchase/refinancing expenses into a single loan
USDA Repair Escrow	Refinancing or buying USDA property that needs updating or repairs.	100% financing for refinancing or home purchase in a USDA rural area Creates dedicated account to cover repairs Fewer costs by rolling repair and purchase/refinancing expenses into a single loan

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To be used on conventional loans for both appraiser-required repairs and repairs the borrower wants done to the property. It can be used on second homes and investment properties. The repairs can be structural in nature or cosmetic, but they must be attached to the property and add value. The only time appliances (stove and dishwasher) may be included in the renovation is if there is a full kitchen remodel including cabinets and countertops and the appliances (stove and dishwasher) will need to be built in or attached to the property.
*HomeStyle® is a registered trademark of Fannie Mae.

FHA 203K Full

This government-insured loan allows you to buy a home that’s in need of major repairs and/or renovations. The repairs can be structural and/or cosmetic in nature. An important benefit is you can buy a home and complete the repairs using just this loan. This loan offers fixed rates with only a 3.5% down payment required. The home must be your primary residence. The FHA 203K is also available for refinance transactions.

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FHA 203K Streamline [203K(s)]

This is similar to the FHA 203K Full loan, but is more limited in its scope. The repairs can only be cosmetic in nature and are limited to a maximum of $35,000. Because the repair costs are smaller, there is less red tape to get the loan, which is why it’s called "streamline." These loans can also be used to refinance existing mortgages and rehab homes.

EZ "C"onventional

To be used on conventional loans for both appraiser-required repairs or repairs the borrower wants done to the property. The repairs must be non-structural in nature (no exceptions) and they must be attached to the property and add value.

HUD REO with Repair Escrow

This loan can be used on HUD REO listings only where the appraiser has required MPR (minimum property requirement) type repairs. These are loans for homes that failed to sell at a foreclosure auction, which have been claimed by the lender and put back up for sale. These homes are REO (real estate-owned property), for which HUD, (The Department of Housing and Urban Development), has paid off the mortgage.

Minimum Property / Appraiser / Underwriter Required Repairs

To be used on FHA financed loans where the appraiser or underwriter has required MPR (minimum property requirement) type repairs.

Buyer / Seller Funded Repair Escrow

Can be used on an FHA or conventional loan. Can also be used on a VA loan only if the seller is funding the repairs. Repairs do not have to be appraiser-required but the appraisal must be subject to those repairs being completed.

Pool Escrow

Can be used on a conventional loan (finance or refinance) to include the cost of a new swimming pool.

USDA Repair Escrow

To be used on a USDA-financed loan where the appraiser has required MPR (minimum property requirement) type repairs. For designated rural properties, they are guaranteed by the Department of Agriculture. Benefits include financing up to 100% of the purchase price and no monthly mortgage insurance premium.

Weather-Related Escrow

Can be used on an FHA or conventional loan. These loans can also be used on a VA loan by exception only if the seller is funding the repairs. Repairs do not have to be appraiser-required but the appraisal must be subject to those repairs being completed.

Jumbo Renovation Loan

To be used on a jumbo renovation loan for either appraiser-required repairs or repairs the borrower wants done to the property. The repairs must be non-structural in nature (no exceptions) and they must be attached to the property and add value.

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