How do Renovation Loans Work?

Renovation Loans allow for purchasing or refinancing a home and financing the repairs. Consequently, the appraisal is based on the as-completed value.  In addition, these loans are also excellent for first-time home buyers that found good deals on a fixer-upper. Call us to show you how easy it is.  

FHA Renovation Loans


FHA 203K Standard 

  • 3.5% down payment for primary homes only.
  • Allows for six months of mortgage payments financed in loan amount while under renovation.
  • Structural repairs are allowed
  • Requires an FHA consultant.
  • One Two-unit home, Manufactured home, approved condo, PUD allowed

FHA 203K Limited  

  • 3.5% down payment for the primary home only.
  • Allows for repairs up to a maximum of $35,000.
  • No Structural repairs
  • Requires a general contractor; DIY not allowed
  • Great for new kitchens and baths, new roofs, energy-efficient appliances, and flooring. A consultant is not required.

Conventional Renovation Loans

  • 95% financing for primary homes
  • 90% financing for second homes
  • 85% financing for investment
  • Luxury Items allowed, such as pools, hot tubs, and outdoor kitchens
  • Perfect for a complete renovation with luxury items

VA Renovation Loans

  • 100% financing of purchase and repairs
  • Used for minor renovation and non-structural repairs
  • No consultant is required
  • One- and two-unit homes as primary residences only.

Construction Loans

Construction loans have a one-time closing for primary residences only. In addition, allow for the purchase of the land and include the construction costs. Borrowers may own the ground before the loan application.

FHA Construction Loans

  • 3.5% down payment
  • Fixed rate one-time closing
  • Minimum 620 Credit score
  • Draws are made at several stages of construction until completion
  • Primary residence only

VA Construction Loans

  •  100% financing
  • One-time close with a fixed rate
  • Minimum 620 Score required
  • Draws made at several stages of construction until completion
  • One unit and modular homes allowed
  • Primary residence only

 **CharterStone Mortgage is not affiliated with or acting on behalf of or at the direction of FHA, VA, USDA, or the Federal Government.

Programs are subject to change without notice. All applicants must meet underwriting guidelines from the lender that are subject to change without notice and must meet all Federal and State regulations. This information is not guaranteed to be accurate due to changing financial and economic environment.    

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