What is a Conventional Renovation Loan?

Are you looking to buy a fixer-upper or upgrade your current home in Centennial, CO? A renovation mortgage might be the perfect solution. A conventional renovation loan allows you to finance both the purchase or refinance of a home and the cost of repairs into a single mortgage. This means one application, one closing, and one monthly payment.

At Choice Mortgage Group, the RJ Baxter Team specializes in these unique loan products. We are experts at providing second opinions on conventional renovation loans. If another lender has turned you down or given you confusing terms, we can review your scenario to see if a conventional renovation loan is a viable path forward.

While some buyers might opt for an FHA 203k renovation loan, conventional options often provide more flexibility for structural repairs and luxury upgrades. You might also want to explore a purchase plus improvements renovation mortgage depending on your specific financial goals and the scope of your project.

Comparing Fannie Mae HomeStyle and Freddie Mac CHOICERenovation

When exploring a conventional renovation loan, you will typically encounter two primary programs: the Fannie Mae HomeStyle loan and the Freddie Mac CHOICERenovation loan. Both are excellent tools for homebuyers and homeowners alike.

• Fannie Mae HomeStyle: This program is highly flexible. It allows borrowers to fund almost any type of improvement, including luxury additions like swimming pools, outdoor kitchens, or extensive landscaping, as long as the upgrades are permanently affixed to the property.
• Freddie Mac CHOICERenovation: This option is ideal for financing large-scale renovations. It places a strong emphasis on upgrades that help with aging in place or improvements that increase a home’s resilience to natural disasters.

Both programs require a solid credit profile, but they offer the distinct advantage of allowing you to borrow against the future appraised value of the home. This means your loan amount is based on what the house will be worth after the renovations are complete, giving you maximum borrowing power.

Feature	Fannie Mae HomeStyle	Freddie Mac CHOICERenovation
Eligible Properties	1 to 4 units, primary, second homes, investment	1 to 4 units, primary, second homes, investment
Allowed Upgrades	Any permanent improvement, including luxury items	Repairs, disaster resilience, aging in place
Loan Basis	As-completed appraised value	As-completed appraised value
Minimum Down Payment	As low as 3% for primary residences	As low as 3% for primary residences

Why Choose the RJ Baxter Team for Your Renovation Mortgage?

Finding the right home loan requires careful consideration of your needs, finances, and history. The RJ Baxter Team at Choice Mortgage Group is proud of the level of service we provide to our clients in the Denver marketplace and Centennial, CO. We value honesty, hard work, and responsiveness to your needs.

We know you do not deal with mortgage broker jargon every day. We use common sense and communicate with you in terminology that you will understand. Whether you need a primary renovation mortgage or you are seeking a second opinion on a complicated conventional renovation loan, we are here to help. We treat every client like family and strive to give you the best possible, stress-free mortgage experience.

Q1: What is a renovation mortgage?

A renovation mortgage is a single loan that covers both the cost of purchasing or refinancing a property and the cost of the planned home improvements.

Q2: Can I use a conventional renovation loan for investment properties?

Yes. Both Fannie Mae HomeStyle and Freddie Mac CHOICERenovation loans can be used for investment properties, making them highly versatile for real estate investors.

Q3: How does a conventional renovation loan differ from an FHA 203k?

Conventional renovation loans generally require higher credit scores but offer more flexibility for luxury upgrades, whereas FHA 203k loans are government-backed, have lower credit requirements, and restrict certain luxury improvements like swimming pools.

Q4: Do you offer second opinions on conventional renovation loans?

Absolutely. We are experts at providing second opinions on conventional renovation loans. If you were denied elsewhere or want to ensure you are getting the best terms, our team will gladly review your application.

Q5: How is the loan amount determined for a renovation mortgage?

The loan amount is based on the as-completed value of the home, which means the appraiser evaluates the property based on what it will be worth after all renovations are finished.

Ready to Transform Your Home?

Contact RJ Baxter and the Choice Mortgage Group team in Centennial, CO today to discuss your conventional renovation loan options.Call 303-670-0137Email RJ Baxter