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Renovation Loans

Finance your home purchase and improvements in one loan. Perfect for fixer-uppers and dream home transformations.

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Renovation Loan Options

Fannie Mae HomeStyle® Renovation

Conventional purchase-plus-rehab for primary, second home, or investment — pools allowed, 15-month completion, DU only

Freddie Mac CHOICERenovation®

Conventional rehab for primary, second home, or investment — pools allowed, LPA Accept underwriting, and up to 97% LTV with eligible Home Possible.

Luminate Bank Interim Renovation Loan

Short-term interest-only construction financing for major renovations and fix-and-flip before permanent financing or sale.

Low Down Payment Renovation Loans

FHA 203(k)

Primary-residence rehab with as little as 3.5% down — buy and renovate a fixer-upper with one FHA loan. Full Standard for major work or Limited Streamline for cosmetic updates up to $75,000.
FHA 203(k) Overview Full Standard Limited Streamline

HomeReady® HomeStyle® Renovation

Primary-residence rehab with as little as 3% down — HomeReady income-eligible buyers who want HomeStyle renovation in one conventional loan.

Home Possible Freddie Mac CHOICERenovation®

Primary-residence rehab with as little as 3% down — Home Possible income-eligible buyers who want Freddie Mac CHOICERenovation® in one conventional loan.

Compare Renovation Loans

Side-by-side comparison of all six renovation programs — see minimum loan amount ($100,000), renovation cost limits, consultant requirements, max draws, minimum credit scores, down payment, occupancy, and what each loan is built for before you estimate your payment.

Feature Fannie Mae HomeStyle® Freddie Mac CHOICERenovation® Luminate Interim Renovation FHA 203(k) HomeReady® HomeStyle® Home Possible CHOICERenovation®
The smallest total loan size this lender/program will fund. Every program shown here starts at $100,000. $100,000 $100,000 $100,000 $100,000 $100,000 $100,000
The smallest rehab budget the program will finance. Some programs have no floor; others require a minimum repair package. None None $50,000 Standard: $5,000 · Limited: none None None
The upper limit on financed repairs — often a percent of after-repair value (ARV), a dollar cap, or none depending on the program. None Standard: none · Limited: $75,000
Whether a renovation or HUD 203(k) consultant must prepare the work write-up and help manage draws. Conventional programs often require one only in certain states; FHA Standard always requires a HUD-approved consultant. AK/CA/HI/NY only AK/CA/HI/NY only Not required Standard: required · Limited: none AK/CA/HI/NY only AK/CA/HI/NY only
How renovation funds are released from escrow. A draw pays the contractor after an inspection confirms completed work. Most permanent programs allow five draws plus a final inspection; Interim allows up to two draws per month. 5 + final 5 + final 2 per month Standard: 5 · Limited: 2 5 + final 5 + final
The typical lowest middle FICO many lenders accept for that program. Overlays, LTV, and pricing can raise the practical floor. Conventional renovation usually starts near 620; FHA often near 580 for 3.5% down; Interim steps up for larger loan amounts. 620 620 700 · 720 above conforming 580 (3.5% down) 620 620
The smallest cash down payment typically allowed for a purchase on that program (refinance may differ). Actual down payment depends on occupancy, credit, and underwriting. 5% 5% Varies by deal 3.5% As low as 3% As low as 3%
The mortgage category backing the rehab — conventional (Fannie/Freddie), FHA, or short-term interim construction financing that later converts or pays off. Conventional Conventional Interim construction FHA Conventional Conventional
Who can live in (or own) the property under the program — primary residence, second home, investment, or fix-and-flip uses. Primary, second home, investment Primary, second home, investment Primary, investment, fix-and-flip Primary residence Primary residence Primary residence
Whether household income must stay under a program cap (common on HomeReady® and Home Possible®). “None” means no income ceiling for that product. None None None None Yes (HomeReady®) Yes (Home Possible®)
Extra coverage lenders require when you put less than 20% down (PMI on conventional) or on FHA loans (MIP). Short-term interim loans typically do not use PMI/MIP. PMI if under 20% down PMI if under 20% down Typically none (short-term) FHA MIP required PMI if under 20% down PMI if under 20% down
Program highlights that set this option apart — pools, underwriting path, interest-only draws, Limited vs Standard, or income-eligible pricing. Pools allowed; ~15-month completion; DU only Pools allowed; LPA Accept Interest-only draws for major rehab before permanent financing or sale Full Standard or Limited Streamline (up to $75k cosmetic) HomeStyle rehab + HomeReady income-eligible pricing CHOICERenovation rehab + Home Possible income-eligible pricing
The borrower profile or project type this program usually fits best — a quick guide, not a guarantee of approval. Flexible rehab on any occupancy type Conventional rehab with Freddie Mac underwriting Large projects and fix-and-flip Lower down payment & more flexible credit Income-eligible buyers wanting 3% down + rehab Income-eligible buyers wanting 3% down + rehab

Guidelines vary by credit, property, and underwriting. Hover or tap each feature name for a short definition — and ARV / MH in Max. Renovation Costs for those abbreviations.

Renovation Loan Calculator

Estimate your total loan amount and monthly payment for a home purchase plus renovation project.

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This calculator is for informational purposes only. Results are estimates and are not exact — they do not include all closing costs, prepaid interest, or escrow deposits. Contact us for a personalized quote.

Mortgage Knowledge Center

Common Renovation Loan Questions

Straight answers on how renovation financing works, which properties qualify, what repairs you can roll into the mortgage, when you can start renovating, which improvements are allowed, luxury upgrades, contractor approval, DIY limits, FHA 203(k), HomeStyle, additions, roof replacement, HVAC, kitchens, and bathrooms.

What Is a Renovation Loan? What Homes Qualify for a Renovation Loan? Can I Finance Repairs With a Renovation Loan? Can I Renovate Immediately? What Improvements Are Allowed? Can Luxury Improvements Be Included? How Are Contractors Approved? Can I Do the Work Myself? What Is an FHA 203(k)? What Is a HomeStyle Renovation Loan? Can I Finance Additions? Can I Finance a Roof Replacement? Can I Finance HVAC Replacement? Can I Finance Kitchens? Can I Finance Bathrooms? Can I Buy and Renovate With One Loan? How Are Renovation Funds Distributed? What Inspections Are Required? How Long Do Renovations Take? Is a Renovation Loan Right for Me?

2MG Daily

Latest Renovation Insights

Recent articles from our blog covering renovation loans, FHA 203k, and fixer-upper financing tips.

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