Purchase + Renovation
Buy a fixer-upper and roll the repair costs into the loan.
Renovation Loans
Your Renovation Estimate is Ready — Now Let's Get It Funded
Many homeowners discover renovation costs more than they expected. A renovation loan lets you finance both the purchase and the repairs in one loan. Here's exactly how it works.
The basics
What Is a Renovation Loan?
A renovation loan lets you finance both the purchase or refinance of a home and the cost of repairing or upgrading it - all in one loan.
Two Common Ways to Use a Renovation Loan
Reno Refi
Refinance your current home and pull out equity to fund renovations. This is popular because you can roll everything into one loan and use the future value of the improved home.
Why it helps
Why Homeowners Love Reno Loans
Renovation financing can turn a rough house into a real plan instead of a cash-heavy guessing game.
Save Cash Upfront
Roll repair costs into the loan instead of paying everything out of pocket.
One Monthly Payment
Keep the purchase or refinance and renovation budget together in one payment.
Finance the After-Repair Value
Use the future value of the improved home, not just the current condition.
Less cash upfront. One payment. More confidence in the numbers.
Step by step
How Renovation Loans Work — Step by Step
It's simpler than most people think.
Step 1
Get Your Renovation Estimate
Use Makeover Estimator to create an accurate scope of work and cost breakdown.
Step 2
Get Qualified With a Reno Lender
Work with a lender experienced in renovation loans to get pre-approved.
Step 3
Make an Offer on the Home
Skip this step if you're already living in the house you want to renovate.
Step 4
Meet With the HUD Consultant
The consultant reviews and confirms the scope of work and cost estimate for the lender.
Step 5
Have Your Contractor Finalize the Bid
Your contractor reviews and finalizes the pricing and details.
Step 6
Appraisal & Loan Approval
The lender appraises the home based on its after-repair value and approves the loan.
Step 7
Closing & Renovation
Close on the loan, then the lender releases money in draws as the work is completed.
Step 8
Enjoy Your Updated Home
Make one monthly payment on the full amount - purchase price plus renovation costs.
Loan programs
Common Reno Loan Types
Here are the most popular options.
FHA 203(k) Loan
Government-backed. Great for lower credit scores and larger renovation projects. Allows you to finance repairs along with the purchase.
Conventional Renovation Loan
Offered by many traditional lenders. Often has more flexible terms and higher loan amounts than FHA.
VA Renovation Loan
Available to eligible veterans and service members. Similar benefits with no down payment in many cases.
USDA Renovation Loan
For rural properties. Offers low or no down payment options and can be used for both purchase and renovation.
Loan availability, terms, down payment, and eligibility requirements vary by lender and program. Always confirm details with a licensed mortgage professional.
Lender match
Get Matched With a Renovation Loan Professional
Tell us a little about you and your renovation plans. This is a lender-matching request, not a mortgage application, and no Estimator account is required.
FAQ
Frequently Asked Questions
How much money do I need to bring to closing?
Most renovation loans require only a small down payment, often as low as 3.5%. The renovation costs are rolled into the loan so you don't need a lot of cash upfront.
What kinds of repairs can I finance?
Almost anything that improves the home - kitchens, bathrooms, roofs, siding, flooring, structural fixes, and many energy-efficient upgrades.
How long does the whole process take?
From application to closing, it usually takes 30-60 days. The actual renovation work happens after closing and is paid out in stages as it's completed.
Do I have to live in the house while it's being renovated?
No. Many people rent a temporary place or stay with family during major work. Some loans may even allow temporary housing costs to be financed. Confirm this with your lender.
Can I choose my own contractor?
Yes. You can typically use a licensed and insured contractor. The lender will review contractor bids to make sure pricing and scope are reasonable.
Start with the estimate
Start With a Renovation Estimate
Before you talk to a lender, create a clear renovation scope and cost estimate with Makeover Estimator.
