Conventional Renovation – Homestyle
I’m pleased to share that we now offer conventional renovation loans, called the homestyle program. The use of this program is for a purchaser who would like to finance the purchase of a property and also receive financing for renovations and repairs. Previously, there was only the FHA 203k loan which is sometimes a more expensive choice because of the 1.15%/year mortgage insurance. Also, FHA mortgage insurance never goes away.
The conventional Homestyle program is available for those who have the cash to put down 5%, for loan amounts up to $679,650.
The program works for owner occupants, second homes, and investment properties! Second homes will require 10% down and investment properties require 20% down. These are great options for purchasers who plan to buy and hold a property, they are not intended for investors who plan to flip, however.
On a conventional loan if the purchaser is putting down 20%, there is no mortgage insurance. This differs from FHA which requires mortgage insurance at any down payment.