HomeStyle Renovation Mortgage Loans

This is about the HomeStyle Renovation Mortgage, not the HomePath Renovation Mortgage. If you KNOW you need a Homepath then scroll back for you link. If you are confused as hell and not sure what renovation loan you need then READ ON.

The Fannie Mae HomeStyle Renovation Loan is a mythical beast that only exists in the hearts and minds of hopeful mortgage lenders. I’m pretty sure half of my profession actually believes that, the other half thinks you mean HomePath, not HomeStyle.

If you are familiar with the FHA 203K Renovation Loan then you may have noticed it has some gaps in eligible borrowers and eligible properties.

For ONE, the 203K Mortgage has lower loan limits than conventional CONFORMING (Fannie Mae / Freddi Mac) mortgages. In a lot of FHA markets your MAX loan is $271,050, your max Fannie Mae Homestyle is $417,000 in that same market.

For TWO, 203K loans are for primary residences ONLY. Conventional HomeStyle (and HomePath) Mortgages are allow for 2nd homes and INVESTMENT properties.

Seriously? I can Purchase and Renovate an INVESTMENT Property?

For THREE, Homestyle Renovation Mortgages have ZERO restrictions on repair and scope of work. Luxury items? You got it! SWIMMING POOLS? Absolutely! Want a SAUNA? Not an issue! Seriously, all of these items are perfectly acceptable in a Fannie HomeStyle scope of work.

I Can Repair a SWIMMING POOL?

Let me digress for a second and discuss SWIMMING POOL repair again for a sec. If you live in much of Georgia or ALL of Florida and are looking at foreclosures you have seen a home with a dank, disgusting swimming pool.

Tons of traditional FHA loans die on that detail every month. No problem, just flip it to a FHA 203K Streamline right? Wrong! FHA 203K streamline allows for ZERO pool repair. You can’t touch that swimming pool on a baby 203K. OK, I’ll go Consultant 203K then? Can you fix the pool with $1500? That is the MAX repair allowed on a Standard (Consultant) 203K Loan.

What About a Unfinished New Construction Foreclosure?

For FOUR, you can buy a UNFINISHED Builder Foreclosure with a Homestyle Renovation Loan. Can’t I do that with a 203K Loan? No, FHA requires a certificate of occupancy (C.O.) to have been in place at one point on a home. Builder foreclosures never got that far, thus they cannot be purchased and finished with FHA 203K Loans. You have to go HOMESTYLE.

For FIVE, did I mention that Homestyle Renovation Mortgages are for INVESTORS as well? Oh yeah, I did. A non-property specific investor renovation loan at a fraction of the cost of hard money? Yes.

The word is not out, or my phone with be ringing off the hook. A NON-property specific renovation loan that allows investors to purchase a property that was previously a CASH-ONLY listing? I know, sounds pretty solid because it is!

Investors CAN Buy and Renovate with ONE LOAN!

FINALLY (Sortof), if you hate PMI – Private Mortgage Insurance – then you know that 203K Loans have Mortgage Insurance (MI) regardless of the amount you put down on MOST of the mortgage products. Homestyle Mortgages all for borrowers to put the 20% down and AVOID MI, Yep, no private mortgage insurance!

So What’s the Verdict?

Seriously? Did you read the article? The verdict is awesome. The HomeStyle fills MAJOR gaps in the 203K Renovation loan market.

Its the best INVESTOR LOAN on the market, allows borrowers to avoid MORTGAGE INSURANCE, doesn’t kill my Florida buyers from buying a home with a bunk SWIMMING POOL and allows for buyer’s to pick up unfinished BUILDER FORECLOSURES at a huge discount.

Get with the program, talk to us about the HOMESTYLE RENOVATION LOAN!