Additions can be expensive. Fortunately, there’s a way to add on to your home without breaking the bank. A renovation loan, which rolls the cost of home repairs into your mortgage, is a great way to save money on fixing up your home. Many people aren’t familiar with this type of loan and its benefits. If you’re thinking of adding onto your home in the near future, consider these renovation mortgage loans Las Vegas first.
FHA Limited 203(k)Loan
The Limited 203(k) mortgage can give eligible homeowners up to $35,000 for renovations and non-structural repairs. With this type of loan, you can receive up to the purchase price of your home and an additional $35,000 for upgrades, repairs, remodeling, and general improvements to the kitchen and bathrooms. You can also make improvements to the plumbing and electrical systems, along with the floors, doors, windows, siding, and roof. To get this loan, you need to make an upfront payment that equals 1.75% of the loan amount and 0.85% annually for the principal during the loan’s lifespan. This loan is governed by standard FHA rules.
Standard 203(k) Rehabilitation Loan
This mortgage is ideal if your property needs over $35,000 in repairs. It is also accessible for individuals with a credit score under 580. These standard renovation loans Las Vegas are helpful if you’re planning an extensive remodeling project or other housework, as they do not have any restrictions. This type of loan enables the most significant repairs and even landscaping work. If you’re planning to tear down an existing structure and build a new home, you can use this mortgage for the new construction, too. The standard 203(k) loan has some requirements, including that you hire a consultant to determine the financial feasibility of your projects. Your home must be at least a year old to qualify.
HomeStyle Renovation Loan
The HomeStyle loan is offered through the Federal National Mortgage Association, or “Fannie Mae.” A minimum credit score of 680 is required for this loan. If you have a debt-to-income ratio between 36% and 45%, you’ll need to have a higher credit score of 700 to qualify. There are no restrictions on the types of renovations and improvements you can make with these renovation mortgage loans Las Vegas. Furthermore, you don’t have to spend a minimum amount. However, any improvements you make must be permanent and add value to your property.
If you’re planning an addition to your home, renovation loans Las Vegas can be a great way to make the repairs and improvements you need, and do so at a reasonable cost. If you’re not sure which type of renovation loan to get, or if you want to find out if you qualify, don’t hesitate to let us know. We will gladly explain the advantages of a renovation loan and help you find one that’s right for you.