Nearly every homeowner has dreamt up an idea to make their home more appealing, more valuable, or to simply fit their living style better. Maybe you are the entertainer of the family, hosting big family gatherings and would like the kitchen to be more open to allow for more face-to-face hang time with the family. It would have all the custom touches like commercial grade appliances, granite countertops, and an incredible kitchen island with an indoor grill. Oh, the possibilities are endless.
Or, maybe you are looking for that perfect home, in that perfect location, with those perfect housing bones that would take a little imagination and some renovation work to create your new dream home. You know the one. Built in the late 80’s sitting on 2 acres with lake access and plenty of space for the family pet to run around. Yeah, that one. With some remodeling it could be your new custom home.
But where do you start? At Arbor Financial, we offer two great renovation loan options to help you finance and update your home from drab to fab!
What is a renovation loan?
A renovation loan gives homeowners or prospective homeowners the funds needed to fix, update or renovate their home. Whether your home needs small cosmetic updates or larger more complex renovations, like a room addition, new garage, or total remodel, Arbor Financial has renovation loan options that may be your solution.
Cosmetic Updates. The purpose of the Arbor Financial renovation mortgage is to help borrowers buy a home as well as fund home improvements while having only one mortgage payment. It works like this, you find a house that sells for $150,000 and you plan on putting $50,000 into repairs and upgrades, your renovation mortgage can be for up to 97% of the home purchase price plus repairs or in this case $194,000*.
The Arbor Financial renovation mortgage is designed for non-structural and cosmetic improvements up to $50,000 (e.g. Paint, carpet, counter tops, cabinets, siding, AC/Heating, enhancing accessibility for a disabled person, windows or new roof). If you are looking to add an addition onto the home, knock down walls, or other structural upgrades then a construction renovation loan would be the way to go.
Construction remodel. When you are considering a more extensive renovation, one that costs more than $50,000 or that involves structural work (additions, removing walls, adding a garage) then the Arbor Financial construction renovation loan can help you.
Benefit of the renovation loan
The biggest benefit of Arbor Financials renovation loan is how quick you can access the funds compared to government backed FHA renovation loans.
How do You qualify for a Home Renovation Loan
To qualify for an Arbor Financial renovation loan the home, condominium, or manufactured house must be your primary residence. You can however purchase a 2-unit duplex as long as you occupy one of the units. You can borrow up to 97% of the total cost of the home and upgrades (slightly less for manufactured homes). Second homes will also qualify up to 90% of loan to value with a credit score of 700 or greater. Improvements are for up to $50,000 in non-structural work.
The best thing to do is work with your local mortgage lender who can run several scenarios for you and help provide you with the best mortgage solution. Don’t let the old outdated oak cabinets prevent you and your family from purchasing an otherwise perfect home, call us today 269.544.3105.
*subject to appraised value.