Turn a Charm Into a Dream With a Las Vegas Renovation Home Loan
You have found a wonderful, charming home in a great neighborhood, but there is one big problem. It’s a fixer-upper and needs plenty of tender loving care. Instead of passing it up, consider a renovation loan where you can roll the costs of repairs into your mortgage, saving you both time and money. Fairway Independent Mortgage Corporation has a variety of options for your renovation loan Las Vegas.
HomeStyle Renovation Loan
HomeStyle renovation loans are available through Fannie Mae, more formally known as the Federal National Mortgage Association. This U.S. Government-sponsored funding requires only a five percent down payment for a fixed rate mortgage on a single-family home. To qualify for this loan, you’ll need a credit score of at least 680. Applicants who have a debt-to-income ratio higher than 36 percent but less than 45 percent, the qualifying credit score will need to be 700 or higher.
After you are approved for the loan, you will have 12 months to complete the work, which does not have any restrictions on the type of improvement or renovations to be performed. Neither will you be required to spend a minimum amount. One firm requirement is that the improvements must be a permanent part of the property and add value to it.
You can borrow up to 50 percent of the cost of your home to pay for your Las Vegas renovation. Eligible costs include property inspection, permit and licensing fees and architectural and engineering fees. (Read more about reverse mortgages here.)
Limited 203(k) Rehabilitation Mortgage
Another option is the FHA Limited 203(k) mortgage that can provide up to $35,000 for non-structural repairs or renovations. Borrowers can receive the purchase price of their home and up to $35,000 in additional funds for repairs, upgrades and improvements such as kitchen and bath remodeling and basement upgrades. No minimum amount is required. Qualified improvements also include:
- HVAC systems
- Windows, doors and siding
- Roofs, gutters and downspouts
All standard FHA rules apply to this type of loan. Borrowers will need an upfront payment for mortgage insurance equal to 1.75 percent of the loan amount and 0.85 percent annual on the principal for the life of the loan.
Standard 203(k) Rehabilitation Mortgage
A standard FHA 203(k) mortgage is a good financial instrument for those who want a property that needs more than $35,000 in repairs or who have a credit score that is below 580. Under this program, there are no restrictions involving remodeling, which means you can have extensive work that includes tearing down walls and other similar, major repairs that can include landscaping. Even the reconstruction of a demolished home is eligible under this program if the original foundation remains. Homes that are at least one year old are eligible for this loan.
A requirement of the Standard 203(k) is that you must hire a consultant to determine if your projects are financially viable and oversee all work. You can borrow up to 110 percent of what an appraiser thinks the home will be worth following renovations or the cost of the property in addition to the renovations, whichever is less.
Borrowers are also subject to the minimum FHA down payment of 3.5 percent. Additionally, your maximum mortgage must be below the FHA mortgage limit for your area.
Other Possible Loans
You may also qualify for an additional renovation loan Las Vegas through our office. One of our loan officers will be glad to help you assess your qualifications for:
- EZ Conventional that helps finance small upgrades over a short period of time through a dedicated account to cover costs
- Buyer/Seller funded repair escrow that rolling construction and purchase/refinancing expenses into a single loan
- Jumbo Renovation that covers repairs up to $250,000
- Weather-Related Escrow to finance energy efficient upgrades or damage caused by weather events
Your local Drennen Home Loans mortgage professional can help you determine what type of renovation loan is right for your needs. Contact us for additional information.