Renovation Loans: FHA vs. Conventional

Finance the home and the improvements with one simple loan.

Renovation loans make it possible to finance both the home purchase and the needed repairs with a single mortgage. FHA 203(k) and Conventional HomeStyle® renovation loans each offer a path to buying and renovating, but with slightly different requirements and advantages. Understanding the differences can help you choose the right loan for your project.

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Renovation Loans Are Good For:

Renovation loans are ideal for buyers purchasing a fixer-upper or homeowners refinancing to make upgrades. They’re a smart option for those with limited upfront cash who want to finance repairs into their mortgage and compare flexible solutions for home improvements.

Renovation Loan Details

Down Payment and Credit Requirements +

FHA 203(k) loans typically require a down payment of 3.5% and accept lower credit scores. Conventional renovation loans generally require 3% to 5% down but often expect higher credit scores and more reserves.

Eligible Renovation Types +

FHA 203(k) loans are only available for primary residences, while HomeStyle loans can be used for primary residences, second homes, and one-unit investment properties. These programs are not intended for short-term investment or resale.

Choosing the Right Fit +

FHA renovation loans are a good fit for buyers who need a more flexible approval process. Conventional options may be better for borrowers with strong credit who want more control over the renovation details and who may be financing a second home or investment property. A loan officer can help you compare both options and decide what works best for your situation.

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Turning a fixer-upper into your dream home doesn’t have to be complicated. Whether you’re leaning toward FHA or Conventional renovation financing, our experienced loan officers are ready to guide you through each step. Let’s talk and build something great together.

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