Enroll into the home renovation programs and renovate your house
Do you want to renovate and add a sparkle to your house? Are you not able to contact the laborers due to financial constraint? If yes, then you should take advantage of the home renovation mortgage programs. These home mortgage programs help you refurbish and modernize your house with ease. You can borrow money on the basis of the expected home’s fair market value after the renovation is completed. You can also use these programs for both refinancing and renovation purposes. Have a look at the article to know about the mortgages that help you repair and sparkle your house.
Renovation programs help you revamp your house
Here are the 2 home renovation programs that help you revamp your house:
1. FHA 203 (k) program:
You can take advantage of FHA’s 203(k) program for renovating your house. This program has been there in the market for several years. Unfortunately, not many people went for this home mortgage program in the past years. However, the demand for this mortgage has increased in the year 2010.
In this program, you are required to approach a consultant and show him the draft of the construction plan. Basically, you’ll have to show how you have planned to renovate the house. The consultant will analyze the plan prior to making each and every draws. Usually, a draw occurs when a specific amount of money is given to the contractor. You can make only 5 draws and have to complete the project within 6 months. You’ll also have to show how you have spent the money for renovating the house.
2. Home Style mortgage:
You can opt for this program when you have good credit score. You need to have at least 680 credit score to qualify for this program. However, some lenders may agree to give you a loan at a 640 credit score. You can grab the best deal when your present score is 780.
You can get as much as 90% financing for the renovation of your house. Just like the FHA 203 (k) program, the loan amount will depend upon the appraised market value of the house. The maximum loan amount is 95% of the expected value of the house after the renovation is complete.
When you are applying for a home style mortgage, the lender will give you 2 options – fixed rate-mortgage (15 or 30 year) and adjustable rate mortgage. You will have to choose any one of them.
FHA 203 (k) or Home Style: A brief comparison
Go through the following lines to make a brief comparison between FHA 203 (k) program and Home Style mortgage:
1. Credit score: You can qualify for home style mortgage with 680 credit score. There are no minimum credit score criteria for 203 (k) loan.
2. Down payment: You need to make minimum 5% down payment on the loan. On the contrary you’ll have to make around 3.5% down payment on the 203 (k) loans.
In addition to the above mentioned points, you can’t use a 203 (k) loan for constructing a swimming pool in your house. But you can definitely a home style mortgage for this purpose.
Processing your request, Please wait....
