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Mortgage Glossary

Renovation Loan

Defined by Onias Derilus, Mortgage Capital · NMLS# 1859012 · Florida licensed mortgage broker

A renovation loan finances both the purchase (or refinance) and the cost of repairs or improvements in a single mortgage.

What Renovation Loan means

Programs like FHA 203(k) and Fannie Mae HomeStyle base the loan on the home's projected after-improvement value, with funds released as work completes.

Florida example

A Florida buyer purchases a dated home for $300,000 and adds $50,000 in renovations through a 203(k) loan, financing the total in one mortgage instead of a separate construction loan.

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