09.02.2024

Upgrade Without Moving: Renovation Mortgage Loans

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By Justin Rutkowski, Mortgage Loan Officer - Breton

In today's dynamic housing market, homeowners have an exciting opportunity to transform their current homes into dream spaces. Whether you're looking to add more room, modernize your kitchen, or upgrade amenities, a renovation loan may be the right solution for you. It allows you to enhance your existing property - without the hassle of moving - so you can stay in the home and neighborhood you love while making it a perfect fit for your lifestyle.
 

What Are Renovations Mortgage Loans?

Renovation mortgages loans, like FHA 203(k) and Fannie Mae HomeStyle Renovation loans, allow you to refinance your current mortgage and include renovation costs in a single loan. This approach provides several key advantages.
 

Access to Untapped Equity for Upgrades

With a renovation mortgage loan, you can tap into the untapped equity of your home based on its projected value after renovations. This allows you to finance major upgrades, like a kitchen remodel or additional rooms, using the anticipated increase in your home's value, without needing to use your savings or take out additional loans.
 

Avoid the Stress of Moving

Renovating your current home means you stay in your familiar neighborhood, avoiding the upheaval and costs associated with moving. You get to enjoy the comforts of your existing home while customizing it to better suit your needs.
 

Increase Your Home's Value

Renovations funded through a renovation mortgage loan can significantly boost your home's market value. By updating key areas or addressing necessary repairs, you enhance your property's appeal and potential resale value.
 

Customization

Renovation loans offer the flexibility to tailor your home to your specific preferences. Instead of compromising on a new home, you can create a living space that truly reflects your style and meets your requirements.
 

Work with an FHA 203(k) Advisor

Working with an FHA 203(k) advisor can simplify the renovation process. These experts guide you through the complexities of the loan, help you select appropriate contractors, and ensure that your renovation plans align with the requirements of the loan program. Their expertise can make the process smoother and more efficient.
 

Conclusion

For second-time homebuyers or homeowners ready to renovate their current home, a renovation mortgage loan provides a practical and streamlined solution. By combining refinancing with renovation costs, you can access untapped equity, avoid the stress of moving, and create a customized home that adds value.

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