Buy It and Fix It With One Loan
Found a home with potential? A renovation loan can help you turn it into the home you want. Programs like FHA 203(k) and Fannie Mae HomeStyle Renovation let you combine the cost of purchasing or refinancing a home with eligible improvements into one mortgage.
Things to Know
- 3.5% / 3%
- 580 / 620
- 1 loan
- Purchase / Refinance
- 9–12 mo
Ready to talk?
A loan officer who answers the phone, knows this program, and will tell you plainly whether it fits.
Disclaimer: Ark-La-TexFinancial Services, LLC d/b/a Benchmark Mortgage – NMLS ID #2143 (www.nmlsconsumeraccess.org) 5160 Tennyson Pkwy STE 1000, Plano, TX 75024. 972-398-7676. This advertisement is for general information purposes only, no guarantee is expressed or implied. Rates, terms, programs and underwriting policies subject to change without notice. This is not an offer to extend credit or a commitment to lend. All loans subject to underwriting approval. Not all applicants will qualify. Some products may not be available in all states and restrictions apply. (https://benchmark.us)
203(k) Limited vs. Standard
The FHA 203(k) comes in two sizes. The Limited 203(k) covers non-structural repairs, such as health and safety items, roofing, systems, accessibility, and decks and driveways, up to a cap HUD reviews annually. It has a simpler process and an optional consultant. The Standard 203(k) handles structural work and larger budgets, and requires a HUD 203(k) consultant to manage the scope and draws.
HomeStyle for conventional borrowers
Fannie Mae’s HomeStyle Renovation is the conventional counterpart: as little as 5% down, no FHA mortgage insurance, and more flexibility on what qualifies — including some luxury improvements. It also works on second homes and investment properties.
How draws and inspections work
Renovation funds are held in escrow and released in draws as work is completed. On a Standard 203(k), the consultant inspects the work and certifies each draw. The payment schedule is agreed to before closing.
Timelines
Plan for a longer process than a standard purchase. Before closing, you'll gather contractor bids, and a Standard 203(k) also needs a consultant's work write-up and cost estimate. After closing, the work typically has to be finished within 9 months on a Limited 203(k) or 12 months on a Standard. Extensions may be possible if the work runs long.
Renovation loan vs. HELOC after purchase
If you already own the home and have equity, a HELOC can fund improvements without reopening the first mortgage. If you’re buying, or you’re equity-light, a renovation loan rolls everything into one payment at one rate.
What makes it work for you?
- Purchase or refinance and eligible repairs in one mortgage
- Two paths: FHA 203(k) (Limited or Standard) or conventional Fannie Mae HomeStyle
- Contractor bids and draw schedule built into the process
- Funds released as work is completed and inspected
- Your loan officer can help you compare options and determine if a renovation loan makes sense
A good fit if you…
- Found the right house in the right neighborhood, it just needs work
- Want to finance repair in your mortgage instead of with credit cards or personal loans
- Own a home that needs updating and want one new first mortgage
- Are an investor using HomeStyle on a non-owner-occupied property
Probably not the right fit if you...
- Plan to do the work yourself, contractor and inspection requirements apply
- Have a small cosmetic budget that cash or a HELOC could cover
- Need to close in under 30 days
- Prefer not to work within contractor bids and inspection requirements
Additional options to think about
Compare with other programs
FAQ
Short, honest answers. Your loan officer can go deeper on any of these.
Can I do the renovation work myself?
No. Renovation loans require licensed, insured contractors so the work can be inspected and funds released on schedule. Sweat equity generally isn’t allowed. [CONFIRM: any Benchmark exceptions]
How long does a renovation loan take?
Expect a longer timeline than a standard purchase — bids, a consultant or inspector, and draw schedules add steps. Most projects must be completed within 6 to 12 months of closing. [CONFIRM: typical Benchmark timeline]
What repairs qualify for a renovation loan?
Most structural and cosmetic improvements qualify: roofs, HVAC, kitchens, baths, flooring, additions, and accessibility work. Luxury items like pools are typically excluded on FHA 203(k) but may be allowed on HomeStyle.
Do I need a consultant for a 203(k) loan?
A HUD consultant is required for a Standard 203(k); a Limited 203(k) (smaller, non-structural projects) does not need one. HomeStyle uses a lender-approved inspector.
Can I refinance into a renovation loan?
Yes. Both FHA 203(k) and HomeStyle offer refinance versions, so you can roll renovation costs into a new first mortgage on a home you already own.
HOW IT WORKS
Four steps from here to keys
Talk to a renovation specialist
A 15-minute conversation about where you are and where you want to go.
Get pre-approved
You provide supporting documents like income statements, W-2s, and bank statements. Most of it can be uploaded in minutes.
Shop with confidence
We handle the appraisal and the paperwork sellers worry about.
Sign & Close
Sign, fund, and get the keys. We stay on the file until the end.
Talk to a renovation specialist
A 15-minute conversation. No obligation. Real answers from a loan officer who answers the phone.