Written By: Dan Moralez, Staff Writer, MortgageCurrentcy.com.
What you probably don’t know about this product is the fact that it has been around since 2005! So where have we all been? As FHA 203k loans grow in popularity, so does the frustration associated with those loans and their limitations. Fannie’s HomeStyle® Renovation loan is a great alternative with much more flexibility than a 203k loan. This is a great alternative for homebuyers purchasing a home. If you are doing the remodel of an existing home, the LTV calculations are far less favorable.
With all of the foreclosures, there has definitely been a demand for rehabilitation loans to help homeowners not only purchase but make improvements to the home they are purchasing. Many have turned to the FHA 203k program. However, the 203k program has limitations not found with Fannie Mae's HomeStyle® Renovation loan. Fannie's HomeStyle® Renovation product is available on a negotiated basis. Not all lenders have access to this product.
Here’s what you need to know: