Loan program · Construction & Renovation
Renovation Loans
Renovation financing lets you base the loan on what the home will be worth after improvements instead of what it is worth today. It is commonly used on older housing stock throughout Northeast Ohio, where solid homes often need kitchens, baths, roofs, mechanicals or accessibility updates.
Guidance by Manny
Who it is designed for
- Buyers making an offer on a home that needs work
- Homeowners funding improvements without a separate HELOC
- Buyers competing for homes that will not pass condition requirements as is
Eligible occupancy types
- Primary residence, with additional occupancy types on some programs
Down payment or equity
Down payment is based on the total of purchase price plus renovation, or on the as completed value, depending on the program.
Major benefits
- One loan and one payment for the purchase and the improvements
- Financing is based on the as completed value
- Opens up homes that need work and often face less competition
Important considerations
- Contractors must be approved and provide detailed bids
- Work happens on a draw schedule with inspections
- The timeline is longer than a standard purchase
- Change orders require approval and can delay the project
How qualification generally works
- Contractor bids and a defined scope of work
- As completed appraisal
- Standard income, credit and asset review
Documents commonly requested
- Photo ID and Social Security number for each borrower
- Most recent pay stubs covering a full 30 day period, if you receive W2 wages
- W2s and/or federal tax returns for the most recent years requested
- Two months of asset statements for accounts used for down payment and reserves
- Current mortgage statement, homeowners insurance and property tax information on properties you own
- Explanations for large or non payroll deposits
- Contractor bids, license and insurance
- Detailed scope of work
Not sure this is the right mortgage?
Tell Manny what you're trying to accomplish. He can help you compare this program with other financing options that may fit your situation — your income and how it is documented, your credit and assets, the property and how you will use it, your timeline, and the guidelines that apply. Most borrowers have more than one workable path.
Frequently Asked Questions
Related programs and next steps
FHA 203(k) Renovation Loans
FHA financing that includes repair and improvement costs in the mortgage.
Learn more Construction & RenovationFannie Mae HomeStyle Renovation
Conventional renovation financing with broader property and improvement eligibility.
Learn more Construction & RenovationOne Time Close Construction Loans
Build a custom home with a single closing that converts to permanent financing.
Learn more Home EquityHELOC
A revolving line of credit secured by the equity in your home.
Learn moreConsidering renovation loans?
We will review your documents, compare the realistic options, and give you a written preapproval you can use with confidence. Nothing on this page is a commitment to lend.