The FNMA HomeStyle conventional mortgage allows a buyer to purchase a home that needs renovations and include them in the financing. This facilitates the purchase of the home and the renovations in one loan rather than getting a separate second mortgage or home equity line of credit.The combination of these loans should save closing costs as well as interest rates which would typically be higher on a home improvement loan.
The borrower will need to have an itemized, written bid from a contractor covering the scope of the improvements. Any type of renovation or repair is eligible if it is a permanent part of the property. Improvements must be completed within 12 months from the date the mortgage loan is delivered.
- 15 and 30-year fixed rate and