Buy the worst house on the best street. Finance the fix.
Instead of paying cash for renovations after closing (or settling for a home that doesn't need work), a renovation loan wraps the purchase price and the project cost into one mortgage, based on what the home will be worth after the work is done.
Start With Your Project
How big is the renovation?
The right program depends on the scope of work. Pick the tier that matches your project, and the eligible programs narrow down from there.
Cosmetic / Limited
Budget up to $75,000
CHOICEReno eXPress
203(k) Limited
VA Renovation
USDA Limited
Full / Structural
No budget cap (up to 75% of as-completed value)
HomeStyle
CHOICE Renovation
203(k) Standard
USDA Standard
Run the Numbers
HomeStyle Renovation Calculator
Enter the purchase price, renovation budget, and estimated after-renovation value to see your loan amount, down payment, and cash to close.
Total Loan Amount
--
Based on after-renovation value of --
Estimates only. Does not include taxes, insurance, or PMI. Soft costs based on standard HomeStyle fee schedule. Actual amounts may vary. Draw admin fee ($850) is not financeable and is included in cash to close.
How It Works
You buy the home. We finance the project. Draws handle the rest.
Get pre-approved with the renovation scope in mind
During your Clarity Call, we review the property, the project, and figure out which program fits. Your loan amount is based on the home's as-completed value (after renovations), not what it's worth today.
Get contractor bids and finalize the scope
Your contractor provides a detailed bid with line items, materials, labor, and timeline. This becomes part of the loan file. Some programs (203k Standard) require a HUD-approved consultant to review the scope.
Close the loan, then renovation begins
You close on the purchase + renovation cost in a single loan. An escrow account holds the renovation funds. Your contractor can receive up to 50% of material costs upfront after closing (varies by program).
Draws released as work is completed
As your contractor finishes each phase, an inspector verifies the work. Funds are released from escrow. This repeats until the project is complete. You're making your full mortgage payment from day one (unlike construction loans which are interest-only).
Final inspection, project complete
Once all work passes final inspection, remaining escrow funds are released. You now own a renovated home with a single mortgage based on its improved value.
Full Comparison
All 8 renovation programs, side by side.
This table covers every renovation product available. Scroll horizontally on mobile.
| Feature | HomeStyle | CHOICE | CHOICE eXPress | 203(k) Limited | 203(k) Standard | VA Reno | USDA Limited | USDA Standard |
|---|---|---|---|---|---|---|---|---|
| Type | Conv | Conv | Conv | FHA | FHA | VA | USDA | USDA |
| Eligible work | Structural + luxury | Structural + luxury | Cosmetic only | Non-structural | Structural | Non-structural | Non-structural | Structural |
| Max reno budget | 75% of value | 75% of value | 10% of value | $75,000 | No limit | $75,000 | $75,000 | No limit |
| Min down payment | 3% / 5% | 5% | 5% / 3% | 3.5% | 3.5% | 0% | 0% | 0% |
| Min FICO | 620 | 620 | 620 | 620 | 620 | 620 | 620 | 620 |
| Reno timeline | 6 mo | 6 mo | 6 mo | 9 mo | 12 mo | 120 days | 6 mo | 10 mo |
| Property types | 1-4 unit, 2nd, inv | 1-4 unit, 2nd, inv | 1-4 unit, 2nd, inv | 1-4 unit primary | 1-4 unit primary | 1 unit primary | 1 unit primary | 1 unit primary |
| Refinance eligible | Yes | Yes | Yes | Yes | Yes | Purchase only | Purchase only | Purchase only |
| Material advance | 50% after close | 50% after close | 50% after close | 50% of bid | None | 50% of bid | 50% of bid | None |
Common Questions
What buyers and agents ask most.
Can I use my own contractor?
Yes, but they need to meet the program's requirements: licensed, insured, and experienced with the scope of work. Some programs require the contractor to be reviewed by the lender or a HUD consultant. I can walk you through what's needed for your specific program.
What counts as "structural" vs "cosmetic"?
Cosmetic/non-structural work includes anything that doesn't alter the load-bearing structure: new kitchen, bathrooms, flooring, paint, roof, windows, HVAC, landscaping. Structural work involves moving or removing load-bearing walls, adding rooms, foundation repair, or changing the footprint of the home.
Can I refinance an existing home to renovate it?
Yes, on most programs. HomeStyle, CHOICE, and both FHA 203(k) products allow refinance transactions. VA Renovation and USDA are purchase-only.
What if the home is unlivable during renovation?
Some programs (HomeStyle, CHOICE, 203k Standard) allow you to finance up to 6 to 12 months of mortgage payments into the loan if the property is uninhabitable during construction. This means you can continue paying rent while the renovation happens without carrying both costs out of pocket.
Can I do a renovation loan on an investment property?
Yes, with conventional programs (HomeStyle, CHOICE, CHOICEReno eXPress). FHA, VA, and USDA are limited to primary residences. Investment property renovations require a 15% down payment minimum.
What's a HUD consultant and do I need one?
A HUD-approved 203(k) consultant is a third party who reviews the renovation scope, creates the work write-up, and monitors the project. They're required for FHA 203(k) Standard loans. The limited 203(k) and conventional programs don't require one.
How is the loan amount determined?
The appraiser evaluates the home based on the proposed renovation plans and provides an "as-completed" value. Your loan is based on the lesser of the purchase price plus renovation cost, or the as-completed appraised value. This means you're often getting into a home at less than its post-renovation market value.
Ready to Renovate?
Let's match the project to the right program.
Bring the property listing, the project ideas, and a rough budget. I'll figure out which renovation program gives you the best terms and walk through the real numbers.
Christian Kosko | NMLS# 1415795 | Fairway Independent Mortgage Corporation
NMLS# 2289 | Equal Housing Lender | Licensed in DC, MD, VA
Renovation loan programs are subject to property eligibility, contractor approval, borrower qualification, and program availability. Maximum renovation budgets, timelines, and eligible improvements vary by program. This page is for educational purposes only and does not constitute a loan approval or commitment. All loans subject to underwriting approval.