An FHA type loan which allows you to purchase or refinance a home and roll in all the improvements or repairs of the home into a single loan.
Renovation loans can be done as a purchase or a refinance transaction
A standard 203k loan program allows a loan amount that is 110% of the after improvement value determined by the appraisal. A 203k consultant is required to perform a thorough home inspection in order to do the complete work write-up. A minimum of $5,000 must be borrowed for the sake of repairs. The maximum loan amount depends on the proposed appraisal value. All other qualifying guidelines are pretty much similar to other FHA loans.
The Renovation and Loan Process
- Step 1 – Call our branch to get prequalified for the mortgage and a definitive loan amount
- Step 2 – Writing The Sales Contract
- Step 3 – Work Write-up from contractor and consultant
- Step 4 – Appraisal is ordered and value determined for after improved value
- Step 5 – Lender Prepares/Issues Firm Commitment Application
- Step 6 – Mortgage Loan Closing
- Step 7 – Construction Begins
- Step 8 – Funds are Released from Rehab Escrow Account directly from our office in Connecticut
Note: Work must begin within 30 days of loan closing
Types of Renovations allowed:
- Roof, gutters, downspouts
- Heating/AC •Windows/Siding
- Septic/Well systems
- Connection to public utility
- Structural Repair
- Mold/Lead Paint
- Asbestos •Infestation
- Additions/Living Space
- Finish a basement
- Swimming pool repairs
- Swimming pool install (with Homestyle Renovation Loan Program)
- Energy Improvements
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FAQs, checklists and other valuable information for any size project!
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PLEASE NOTE: LOAN PRODUCTS AND THEIR GUIDELINES CAN CHANGE AT ANY TIME.
DISCLAIMER: This is not an offer to make a loan or to make a loan on any particular terms. All loan applicants must qualify under underwriting requirements and satisfy all contingencies of loan approval. Rates and terms subject to change without notice. Norcom Mortgage NMLS ID # 71655 (www.nmlsconsumeraccess.org)