The Information Desk
The
Information
Desk
We offer Home Renovation Financing Information and Direction for the Best Available Program for Your Needs.
No Obligation.
We offer Home Renovation Financing Information and Direction for the Best Available Program for Your Needs.
No Obligation.
LOAN OPTIONS
| FNMA Homestyle, Freddie Mac Choice | FHA 203K, VA Renovation Loan | Conforming Cash out Refinance | Non Conforming Cash out Refinance |
|---|---|---|---|
| Conforming loan programs. Same as conventional mortgage but with a renovation component. You do the renovation on a set schedule. | Government loan programs. Follow same basic guidelines as regular program and allows for most renovations. You do the renovation on a set schedule. | Conventional loan that gives you some of the current equity as cash at closing. You do the renovation on your own schedule. | Non traditional loan that gives you some of the current equity as cash at closing. There is no renovation schedule. |
| Pros: Has few limitations on renovations. If it adds value you can do it. Is very structured however has contingencies for changes. Sets a detailed budget and completion schedules. | Pros: Allows for credit and income issues conforming loans will not allow. Allows for future value to be at 110% Value when complete. | Pros: No renovation schedule. You can do all your own work as you see fit. | Pros: Allows for non traditional qualifying. No renovation schedule. A lot of investor options. You can do all your own work. |
| Cons: Contractors must be approved. Usually does not allow for do it yourself work. Qualifying time is a little longer than a standard conventional loan. | Cons: Higher fees due to MIP. Does not allow for luxury items or pools. Lower loan amounts in some cases based upon area medians and program. | Cons: Uses the as is value of the home so less cash available for the renovations. | Cons: Uses the as is value of the home so less cash available for the renovations. Rates are higher than conventional cash out refinance. |
| Private Money (fix and flip/hold) Investor Product | Standard HELOC | Renovation HELOC | Stand Alone 2nd Mortgage |
|---|---|---|---|
| Often referred to as hard money. It will allow for future value to be used and a flexible renovation schedule | A 2nd loan product that uses your current equity to do renovations. There is no renovation schedule. | A 2nd loan product that allows renovations and will use the future value instead of the as is value like a regular HELOC. You have a set renovation schedule. | A 2nd loan that has a fixed rate and uses your current equity to do renovations. There is no renovation schedule. |
| Pros: Most flexible renovation product. A lot of investor programs and options. | Pros: Easily available, just about every bank has one. | Pros: Uses future value of the home not the current equity. Very flexible cash draw schedule. | Pros: Quick easy process. Fixed rate offers security unlike HELOC. |
| Cons: Highest rates and most money down. Can be very regional, may not do loans in certain counties or states. | Cons: Not designed for renovation and the programs work more like a credit card with a mortgage rate. Uses the current equity in the home so not as much cash available. | Cons: It is a newer product and is not readily available. Can be very hard to qualify. | Cons: Uses current equity so less cash available at close. |
| FNMA Homestyle, Freddie Mac Choice |
|---|
| Conforming loan programs. Same as conventional mortgage but with a renovation component. You do the renovation on a set schedule. |
| Pros: Has few limitations on renovations. If it adds value you can do it. Is very structured however has contingencies for changes. Sets a detailed budget and completion schedules. |
| Cons: Contractors must be approved. Usually does not allow for do it yourself work. Qualifying time is a little longer than a standard conventional loan. |
| FHA 203K VA Renovation Loan |
|---|
| Government loan programs. Follow same basic guidelines as regular program and allows for most renovations. You do the renovation on a set schedule. |
| Pros: Allows for credit and income issues conforming loans will not allow. Allows for future value to be at 110% Value when complete. |
| Cons: Higher fees due to MIP. Does not allow for luxury items or pools. Lower loan amounts in some cases based upon area medians and program. |
| Conforming Cash Out Refinance |
|---|
| Conventional loan that gives you some of the current equity as cash at closing. You do the renovation on your own schedule. |
| Pros: No renovation schedule. You can do all your own work as you see fit. |
| Cons: Uses the as is value of the home so less cash available for the renovations. |
| Non Conforming Cash Out Refinance |
|---|
| Non traditional loan that gives you some of the current equity as cash at closing. There is no renovation schedule. |
| Pros: Allows for non traditional qualifying. No renovation schedule. A lot of investor options. You can do all your own work. |
| Cons: Uses the as is value of the home so less cash available for the renovations. Rates are higher than conventional cash out refinance. |
