Sometimes, the right home just needs a few updates to make it perfect — fresh floors, a new kitchen, or modern fixtures. If you’ve found a home that’s almost right, a renovation loan can help you finance both the purchase (or refinance) and the improvement costs — all in one mortgage.
At Doma Loans, we help homeowners use renovation financing to customize their new space with confidence and clarity — without the complexity of juggling multiple loans or contractors.
🏠What Is a Renovation Loan?
A renovation loan lets you roll the cost of home improvements into your mortgage. It’s designed for homes that are structurally sound but need moderate repairs or cosmetic upgrades before moving in — not total rehabs or teardown projects.
These loans are great for buyers who want a move-in-ready feel but are open to adding their own finishing touches.
🧩 The Most Common Renovation Loan Options
1. Fannie Mae HomeStyle® Renovation Loan
- Who it’s for: Buyers or owners of primary residences, second homes, or investment properties.
- Down payment: As low as 3% (for primary homes).
- Repair cost limit: Up to 75% of the home’s “as-completed” appraised value (purchase price + improvements).
- Eligible projects: Kitchen remodels, flooring, roof replacement, energy upgrades, or even adding rooms — as long as the work is permanent.
- Completion timeframe: All work must be completed within 12 months after closing.
- Highlights: Flexible, conventional-style loan with standard credit and income requirements.
2. FHA 203(k) Renovation Loans
FHA offers two versions depending on the size and scope of work:
- Limited 203(k):
- For smaller projects (non-structural).
- Repair limit: Up to $35,000 in renovation funds.
- Ideal for: New flooring, appliances, painting, or minor repairs.
- No HUD consultant required.
- Completion: Typically within 6 months.
- Standard 203(k):
- For larger, structural projects.
- Repair limit: Minimum $5,000; no official maximum, but capped by local FHA loan limits.
- Requires a HUD consultant to oversee the project and inspections.
- Completion: Must be done within 6 months of closing.
- Ideal for: Major remodeling, structural repairs, or room additions.
- Available only for primary residences.
🧮 Basic Qualifying Criteria
Renovation loans have slightly more documentation than standard mortgages — but with the right lender, the process is smooth and predictable.
Here’s what’s typically required:
- Credit Score:
- 620+ for HomeStyle
- 580+ for FHA 203(k)
- Down Payment:
- As low as 3% (HomeStyle primary)
- 3.5% for FHA 203(k)
- Debt-to-Income (DTI):
- Typically up to 45%
- Property Type:
- HomeStyle: Primary, secondary, or investment
- 203(k): Primary residence only
- Contractor Requirements:
- Licensed and approved by the lender
- Must submit itemized cost estimates before closing
đź’ˇ Why Choose Doma Loans for a Renovation Mortgage
At Doma Loans, we simplify renovation financing by blending human guidance with modern tech — ensuring clarity from start to finish.
🛠️ One Application, One Closing
No separate construction loan or second lien — we roll your purchase and renovation costs into one smooth transaction.
🧾 Project Support and Oversight
Our renovation specialists coordinate with your contractor and appraiser, helping ensure funds are released on schedule as work progresses.
đź•’ Streamlined Timeline Tracking
We help you stay compliant with FHA or Fannie Mae’s repair completion timelines — avoiding delays or compliance issues.
🤝 Guidance That Fits Your Vision
Whether it’s a small facelift or a bigger transformation, our team helps you understand which loan type fits your home and your budget best.
🏡 Why Renovation Loans Make Sense Today
In a market where move-in-ready homes can be expensive or scarce, renovation loans help you expand your options.
With Doma Loans, you can confidently buy a property that needs a little work — and turn it into your dream home, with financing that fits your life.
Ready to Renovate Smarter?
Discover how much you could qualify for — and see which renovation loan fits your project.
👉 Get started at mortgage.new or call 888-658-3662 to speak with a Doma Loans renovation specialist.
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