What makes a Renovation Loan different?
Most mortgage programs only provide permanent financing that allows you to borrow based on the purchase price or current value of the property. Renovation financing like the FHA 203k renovation loan is unique in that in we are lending you money based on the completed value of your home. You can borrow more money because you are not only tapping into the equity you may currently have in your home, you can also gain access to the increased equity the house will have when finished. This is most helpful when you are planning larger scale improvements like additions that add square footage to your home or adding a second story to a ranch style home. Typically this is done with a single loan and a single closing. We advance funds to the contractor(s) as stages of the project are completed until the loan is fully drawn and construction is finished.
