How to Save 50-100K with HomeStyle Renovation Loan When Buying a House.
What is Fannie Mae HomeStyle Renovation Loan
Fannie Mae Home Style Renovation Loans are the type of loans that will allow you to buy and renovate a home with a single loan.
If you're thinking to buy a home and renovate it, you should be definitely considered Fannie Mae's HomeStyle Renovation Loan. The program, offered by private lenders and with FHA loans, allows you to include the entire cost of the home renovation, and the cost of the property is only one loan product.
In our opinion at SITL Group, more and more people should turn towards HomeStyle loans in the future because those loans, first of all, allows the borrower to renovate the home in their own design especially if they are looking for up to date home ready for move-in. In most cases in an average priced home if you want to purchase a newly renovated house the seller will be an investor or in other words a house flipper. There is nothing wrong with that to purchase a home from an investor but reason number one not to it is you'll save a huge amount of money by using a HomeStyle loan and doing the work by yourself. On an average home priced around 500 000$, in the Stamford-Darien area in Connecticut, you can save 60,000-70,000$ by choosing the right general contractor to do all the work and use HomeStyle Loan. The second reason is having the opportunity to plan and design your future house by yourself it is an amazing option when you buying your first home or even if it is a vacation home or investment property because you can still use a HomeStyle loan for that kind home purchases.
The alternative of the HomeStyle loan when you want a newly renovated home is buying it from an investor and of course, this has his plus and minuses. The good part is it is ready to move in and it is brand new remodeled. The minus is just new but not perfect, it’s is designed by someone else taste or in most cases, there is not much of design in it just entry-level materials throughout the house. The layout is optimized first with the most efficient cost in mind first and not with what is the most optimal for a specific house.
For all these reasons above HomeStyle Loan is the best option on the market for new home buyers who wants to save money and at the same time have a perfect home designed and planned according to their own taste.
How to qualify for Fannie Mae HomeStyle Loan, Requirements and what do you Need To Know.
What is the Down Payment for HomeStyle Loan.
The minimum down payment you’ll be able to obtain a HomeStyle Loan is 3.5-5% from the projected value of the house after the renovation is completed.
This part could be a little confusing for some of you, so let me break it down for you.
On a regular base when you using a mortgage to buy a home, your bank will base the down payment on a percentage of the home's value or purchased price.
If the specific home costs $450,000, and the buyer is putting down 5 percent, then the down payment equals to $22,500
The down payment calculation is a little different from the HomeStyle loan. Fannie Mae allows the home buyers to borrow up to 97% of the combined purchase price and estimated remodeling costs. That means if the house you choose costs $500,000 and your renovations are expected to cost an additional $100,000, you can finance up to $582,000.
Your down payment, then, would be 3-5% of that $600,000 final price, or $18,000-30,000$
In order to qualify for the 3% down payment under Fannie's guidelines, you must be buying and remodeling a primary residence, not a second home or rental property.
Another big plus of Fannie Mae HomeStyle Loan is home buyers can now finance high-cost renovations. Home Remodeling will fit the criteria if they cost up to 75 percent of the purchase price of the house when you add the estimated remodeling costs or 75% of the estimated value of the home after the home renovation is finished.
What is allowed with HomeStyle Loan
Yes, you can add a swimming pool.
Before you start working with your lender on your HomeStyle loan you should be aware of what kind of home renovation you're allowed in your future home.
In comparison with The FHA 203(k) program that does not allow for any “luxury” futures to be added to the house like swimming pool for example or to expand your garage to 4-5 spaces out of the regular for the area 2-3 max, the Fannie Mae HomeStyle would allow you for that kind of home improvement.
Those loans sometimes could be difficult to obtain because of complications you may face like, the HomeStyle Loan program requires very accurate planning of expenses, draw plans, work schedule, and place restrictions on the contractor allowed to perform the home renovation on the property.
Happily for our clients we at SITL Home Renovation and New Construction are well qualified and experienced working with HomeStyle Loans and that's not all we have and licensed Real Estate agents who will assist you with finding the right property for you that will fit all of the Fannie Mae HomeStyle Loan requirements.
Ones you settle on the floorplan, design, and cost of renovation and the loan is about to close you must be 100% sure of everything before it won't be easy to make any alteration to loan ones is processed, so additional time is required for planning and designing everything before you start.
How you can save thousands of dollars using the HomeStyle Loan purchasing a home.
The biggest saving will come from Real Estate fees and transfer taxes.
As we mentioned above if you’re the type of buyer who is looking up to date home ready to move most definitely you have to purchase the home from an investor who bought it with the purpose of renovating it and selling it to buyers like you.
-Here is your first saving, you’ll avoid the 10-15% of the purchased price at minimum the investor will make out of that house.
-Your second saving is the Real Estate fee’s of 6% the investor has to pay to sell the house
-Your third saving is all transfer taxes again the investor must pay and all those expenses are included in the price you’ll pay for a up to date newly renovated home.
I hope all those savings above gave you an idea of how much you can save in the price point you’re looking for a home by buying it in poor condition or unrenovated with Fannie Mae HomeStyle Loan and renovating with the right Home Renovation Company.
SITL Home Renovation and New Construction
Who we are and what is our goal?
SITL Home Renovation and New Construction
2 Armonk st, Greenwich CT
203 550 4498
Info@SITlgroup.com
SITL Home Renovation and New Construction is based in Greenwich CT, construction/home renovation company.
Our main goal is to help and assist our clients with their home renovation projects but our specialty is the major Renovation Projects with HomeStyle Fannie Mae Loans.
We providing a complete A to Z service to our clients from the begging of their search for property that fits the criteria for HomeStyle Loan with our licences Real Estate agents who has many years of experience with investment residential properties.
When we locate the right property for you we will connect you with our partners to assist you with the HomeStyle Loan origination.
Ones you’re pre-approved for the loan and the right property is located we will design it with you, rearrange the layout of the home if needed and submit all the paperwork to your lender.
When the construction starts, that’s where we stand at most. The project management is our favorite topic and you’ll be surprised in the time we need to renovate the oldish looking property you’ve just purchased to an ideal and dreamed home for you.
We are offering a complete home renovation service including 3D Design, Kitchen Remodel, Bathroom Remodel, Flooring, Plumbing, Masonry and Landscaping Services for your back yard and of course Framing if we have to extend the footprint of your house.
Some of our projects completed for clients with HomeStyle Loans
Before the Renovation
After the Renovation
Before the Renovation
After the Renovation
We will be happy to assist you with your home search, design and renovation project if your area of search is in the areas we operate. Greenwich, Stamford, New Canaan, Darien, Norwalk, Westport, Fairfield and Wilton.
You can contact us at any time for more details on Fannie Mae HomeStyle Loans or for your Home Renovation project.
SITL Home Renovation and New Construction 203 550 4498
2 Armonk st info@SITLgroup.com
Greenwich, CT, 06830