Renovation Loan

The Opportunity
Have you been shopping for a home, but feel like you are priced out of the market? It may not be too late for you to buy. With the right property and a little imagination, you can now finance the purchase and the renovation expenses together in a single loan. A California HomeStyle Renovation loan or the FHA 203(K) mortgage allows you to purchase an affordable distressed property with some deferred maintenance for as little as 3% down of the total purchase price and renovation cost.

Get Preapproved. It’s easy!
The loan process is it much easier than you think. The preapproval process is the same as for a conventional loan.

Prepare to finance your purchase with a renovation loan.
The California HomeStyle Renovation Mortgage is available for home and condo buyers that intend to use the property for their primary residence or as a second home. The loan program is available for investors, too!

Once you are preapproved for a loan, but before you submit an offer on a property, you must identify a state of California licensed contractor. As soon as you have selected your contractor, it’s time to contact a real estate professional and start looking at properties in your price range. Your realtor will negotiate the best price for you.

When you’ve made your offer and are under contract, your RTC Mortgage renovation mortgage specialist will schedule a Home Inspection with our HUD consultant (for renovation work less than $35,000, the HUD inspector will not be required). The home inspection will be completed during the inspection period of the contract. During the inspection, the HUD consultant will make a list of all the repairs and cost estimates that need to be completed to make the home financeable. Your contractor can add renovations or remodeling projects to the HUD consultant’s list, up to the maximum loan amount of your preapproval.

As soon as you and your contractor finalize the list of repairs for the renovation project, your contractor will provide you with a construction contract. The total cost of the contract will be added to your purchase price to determine the total cost of your new home. You will need to come in with a minimum down payment of 3% (for first-time home buyers) or 5% for a primary residence, 10% for a second home, and 25% for an investor, of the total cost.

Closing Your California Purchase/Renovation Mortgage
The typical HomeStyle or FHA 203(K) purchase renovation mortgage take 45 to 60 days to close.
At closing, the funds equal to your renovation contract will be deposited into an escrow account.
Your contractor will have up to 12 months to complete the renovation work. Your contractor will be allowed an initial draw to start the project, and up to 4 subsequent draws for work completed. If your home will not be habitable until after the renovation work is completed, you may be eligible to finance your first 6 mortgage payments into the new loan.

Call or email an RTC Mortgage California renovation mortgage specialist for a free consultation today. (949) 494-4861

Get Pre-qualified
Contact Us

Tel: (949) 494-4861
Toll Free: (866) 389-2778
1000 N. Coast Highway, #8
Laguna Beach, CA 92651
Hours: M-F 8am to 5pm Hawaii Time

Buying a home in Hawaii? Visit our affiliate lender Pacific Home Loans.