HomeLander Mortgage

Tag: usda renovation loans

  • Summer is Here!  Ready To Renovate?  

    Summer is Here!  Ready To Renovate?  

    Explore Our Various Renovation Loans

    Many Americans across the nation are taking advantage of the boost in equity their house has received over the past few years by renovating their homes.  Some have chosen new roofing while others have decided they would like to cut costs and go for solar panels.  Maybe you have a newborn on the way and would like to add-on to your home so you can be more comfortable for years to come.  Maybe this heat has made your pool dreams become a necessity.  Whatever the case may be, we have many loans for renovating from which you can choose. Not sure which reno loan is best for you?  No worries.  Simply give us a call and we will guide you to the best renovation loan for you and your family.

    Summer is almost here!  Get those renovations done before school starts again! Our renovation loan products are perfect for fixer-uppers or older homes that need updating!  We have multiple loan options that will suit your needs.

    CONVENTIONAL RENOVATION LOAN

    If you don’t fall under the VA, FHA, or USDA Loan for renovating program requirements, our Conventional Loan for renovating is available to all who qualify!  You can use our conventional renovation loan to purchase a home that needs repairs/updates or refinance a home you already own and add the cost of renovations to your loan balance with a single mortgage closing. Ask us how!

    CONVENTIONAL RENOVATION LOAN FEATURES

    • 620 minimum qualifying credit score
    • Maximum LTV up to 97%
    • Repairs or additions  can be structural or non-structural
    • Eligible property types:
      1-4 Unit Primary Residences
      1-Unit Second Homes
      PUD’s
      Multiwidth Manufactured Homes
      Approved Condos

    VA RENOVATION LOAN

    If you are a veteran, active duty, reserves, national guard service member, or a surviving spouse receiving VA compensation, our VA Loan for renovating may be a perfect fit for you.  You can use these loans to repair or update a home that you already own or purchase a new home and roll in the cost of the renovations at closing.  You can add the cost of renovations to your loan balance with a single mortgage closing.

    VA RENOVATION LOAN FEATURES

    • Renovations and repairs up to $100,000
    • 580 minimum qualifying credit score
    • Loan-To-Value up to 100%
    • Home must be habitable during renovation
    • Repairs must be non-structural
    • Perfect for those looking to do repairs such as repainting, upgrades, fixture updates, or adding accessibility for disabilities such as ramps and rails
    • Conforming Loan Limits only
    • Eligible property types:
      1-2 Unit Primary Residences
      Multiwidth Manufactured Homes

    FHA RENOVATION LOAN

    Our FHA Loan for renovating is perfect for those who qualify!  You can use the loan to purchase a home that needs repairs or updates, or refinance a home you already own, and add the cost of renovations to your loan balance with a single mortgage closing. 

    FHA RENOVATION LOAN FEATURES

    • 580 minimum qualifying credit score
    • Loan-To-Value – Purchase 96.5%, Refinance 97.75%
    • Repairs or additions can be structural or non-structural
    • HUD consultant is required 
    • Eligible property types:
      1-2 Unit 
      Manufactured housing 
      FHA HRAP Approved Condos 
      Site Condo
      PUDs 
      HUD REO

    USDA RENOVATION LOAN

    Do you live in one of the designated areas for USDA loans? If yes, then it may be the perfect fit for you.  You can use the loan to purchase a home that needs repairs or updates and add the cost of renovations to your loan balance with a single mortgage closing (refinances are not allowed).  The USDA loan program has location and income restrictions. If you do not know whether you live in the designated USDA areas, we will be happy to look it up for you.

    USDA RENOVATION LOAN FEATURES

    • 580 minimum qualifying credit score
    • Loan-To-Value up to 100% 
    • Repairs or additions can be structural or non-structural
  • Where Can You Build With A USDA Loan?

    Where Can You Build With A USDA Loan?

    The U.S. Department of Agriculture (USDA) home loans, also known as Rural Development or RD loans, offer 100% financing, low-interest rates, and affordable payments. Additionally, their guarantee fee, which serves as the USDA’s approach to mortgage insurance, can be significantly cheaper than conventional mortgages. USDA loans also have flexible credit standards that can make it easier to qualify. These loans were initially devised to accelerate the economic development of less-dense areas in the United States. 

    With a USDA construction loan, potential homeowners can both finance the land, build a home, and obtain their long-term mortgage – essentially rolling all three loans into one. However, some restrictions do apply.

    The newly constructed home must be the primary residence, and the types of homes eligible to be built are limited to single-family, manufactured and modular homes, and eligible condominiums.

    The biggest factor in USDA Loan Eligibility is that it is location-based. Buyers must use the loan within certain geographical boundaries as published on the USDA’s eligibility maps.

    For the land to be a USDA-approved location, the areas may be “rural in character.” But many small towns and suburbs also qualify. Though buyers in large cities and densely populated suburbs are typically not eligible for these loans, many living in the surrounding areas are. Borrowers don’t have to live in the country or purchase rural land to qualify, and more often than not, USDA-eligible areas are available within 30 minutes of their workplace.

    According to the https://ruralhome.org/ Housing Assistance Council, 97% of U.S. land is located within USDA-eligible boundaries. Those areas comprise nearly one-third of the country’s entire population.

    “Rural” is determined by the USDA by factoring in a community’s overall population, proximity to a major metropolitan statistical area (MSA), and overall access to mortgage credit in the area.

    Therefore, rural areas fall into one of three categories:

    • The area must have no more than 10,000 residents.
    • If the area has 10,001 to 20,000 residents, it cannot be located in an MSA along with a lack of mortgage credit for low- and moderate-income families.
    • If the area has 20,001 to 35,000 residents, it must have been considered rural at one point and have a lack of mortgage credit in the area.

    The easiest way to see if an area is eligible for a USDA Home Construction Loan is to make use of the USDA property eligibility map. Any land outside the shaded areas on the map is eligible. 

    These interactive eligibility maps allow for address lookup. Users can type in the property address into the tool and immediately find out if the property qualifies for USDA financing. 

    Users can also browse neighborhoods and cities.

    Simply enter your address here to see if your address is eligible for a USDA home loan!

    Choosing land in a designated rural area is the first step to qualifying for a USDA loan. As the loan is subsidized through the USDA, borrowers must demonstrate stable income and the ability to make payments without incident for at least 12 months based on assets, savings, and income. Additionally, the borrower must fall under the income threshold dictated by USDA for the area where the home will be located.  

    Other eligibility requirements include: a 640 minimum credit score, no bankruptcy in the last two years, and the USDA must approve the contractors. 

    HomeLander Mortgage will be there to help borrowers determine which type of USDA loan is appropriate to their budget, needs, and qualifications. Schedule a call to begin the process at www.homelandermortgage.com

  • What You Need To Know Before Renovating

    What You Need To Know Before Renovating

    Home renovation loans, also known as Home Improvement loans, are a way for homeowners to finance their fixer-uppers or older homes that need updating. These loans cover the entire renovation project – and yet many potential borrowers don’t know that they are an option – let alone how they work.

    Whether it’s a kitchen or bathroom renovation project, adding on a home office, or installing a new roof, major home improvements require a sound budget. Home renovation loans provide funding for renovating, remodeling, and repairing a home. It can be thought of as a mortgage that includes extra money for home improvements.

    Borrowers who may benefit from a home renovation loan are contemplating home improvement ideas.

    • Are you looking to modernize a kitchen or bathroom(s)?
    • Are you looking to remodel a home to fit your lifestyle and family needs?
    • Are you wanting to add one or more rooms to the house?
    • Are you contemplating the purchase of a home with a low asking price but in need of serious work?

    Additionally, these types of loans give more homeowners and/or borrowers more control over building equity. By making improvements and substantial upgrades, these projects will improve the value of the property in the long run.

    Some types of home renovation loans available include conventional renovation loans, FHA renovation loans, USDA renovation loans, and VA renovation loans.

    Conventional Renovation Loans at a glance:

    • Low fixed rates that are locked prior to closing and guaranteed.
    • PITI (principal, interest, taxes, and insurance) payments are due during the renovation period.
    • Closing costs can be rolled into the loan.  Ask us how. 
    • 97% financing available
    • 620 minimum FICO score required

    FHA Renovation Loans at a glance:

    • Low fixed rates that are locked prior to closing and guaranteed.
    • PITI (principal, interest, taxes, and insurance) payments are due during the renovation period.
    • Closing costs can be rolled into the loan. Ask us how.
    • Up to 96.5% financing available
    • 620 minimum FICO score required

    VA Renovation Loans at a glance: 

    • Low fixed rates that are locked prior to closing and guaranteed.
    • PITI payments are due during the renovation period.
    • Closing costs can be rolled into the loan. Ask us how.
    • 100% financing available (90% on refinance transactions)
    • 620 minimum FICO required
    • Repairs must be non-structural

    USDA Renovation Loans at a glance:

    • Low fixed rates that are locked prior to closing and guaranteed.
    • PITI payments are due during the renovation period.
    • Closing costs can be rolled into the loan. 
    • 100% financing available
    • 620 minimum FICO score required

    While they are similar in that banks and other approved lenders issue them, they differ greatly in type and who qualifies.

    The Federal Housing Administration insures FHA-Insured Loans. Though the FHA does not have income requirements, borrowers need to prove their income, and there are limits on loan amounts. 

    VA Loans are available to veterans who have served or are currently serving in the armed forces, reservist/national guard members, or an eligible surviving spouse. The Department of Veteran Affairs guarantees these types of loans. Borrowers must also have a Certificate of Eligibility (COE). The COE proves that the applicant officially meets the minimum military service requirements. This type of loan is only available through certain VA-approved lenders. 

    The U.S. Department of Agriculture (USDA) loans are for homes in rural areas, though many other suburban communities and locations are also able to qualify. The loan is subsidized through the USDA. Borrowers must demonstrate stable income and the ability to make payments without incident for at least 12 months based on assets, savings, and income. 

    HomeLander Mortgage will be there every step of the way to help borrowers determine which type of renovation loan is appropriate to their budget, needs, and qualifications. Schedule a call to begin the process at www.homelandermortgage.com