Conventional Rehab Loans: Consolidated Financing for Purchase and Renovation
Conventional rehab loans are a real estate financing option for clients interested in purchasing and rehabilitating property in Oklahoma City, Edmond or surrounding areas. The Land Run Mortgage team are local mortgage professionals offering flexible financing terms for conventional rehab loans. As a private lender with extensive experience in the conventional rehab space, we can provide fast approval for clients that big banks simply cannot. Conventional rehab loans consolidate closing costs and simplify payments for homes in need of cosmetic or structural rehabilitation. Contact Land Run Mortgage to explore this and other financing options for a home of your own or for real estate investments.
What is a Conventional Rehab Loan?
Rehab loans, also known as renovation loans, are a type of home loan designed for clients interested in purchasing a home in need of improvements. Conventional rehab loans are a type of single-close loan. They provide funding for the purchase and repair of a home as mandated by an appraiser or that the borrower desires to make. Conventional rehab loans are multipurpose, available for the finance of primary residences, second homes or investment properties.
Conventional rehab loans are funded entirely through private lenders like those at Land Run Mortgage. They fund planned structural and cosmetic renovations on a home that are performed by professional remodelers, plumbers and other trade professionals. They are not designed to cover cost for items like appliances unless as part of a full kitchen remodel or other special circumstances.
One of the most common conventional rehab loans is the HomeStyle Renovation loan, offered through the mortgage company Fannie Mae. HomeStyle loans have affordable down payments and discounted mortgage insurance options. They are available for home purchase and renovation combined cost of up to $417,000. A second common type of conventional rehab loan is the HomePath Renovation option, which can have down payment as low as 5% and may not require any private mortgage insurance. HomePath Renovations are exclusively available for homes that have been foreclosed on through Fannie Mae mortgages. The mortgage professionals at Land Run Mortgage will explain more specifics of each type of conventional rehab loan so you can make the best choice for your needs and goals.
Am I Eligible for a Conventional Rehab Loan?
Because they are privately funded and not insured through the government, conventional rehab loans have more stringent approval requirements than government-backed loans. To be eligible for conventional rehab loans, you will need to show proof that you are able to make your payments and cover other related costs for the property. The Land Run Mortgage team will also evaluate your credit score and credit history as part of your loan application. As independent lenders, we are able to provide financing for many clients who may not be eligible for financing through big banks.
If you are unable to meet the approval requirements for a conventional rehab loan, you may want to consider an FHA 203(k) loan. This renovation loan program similarly combines closing costs and paperwork for home purchase and rehabilitation into a single transaction. This type of loan is backed through the Federal Housing Administration. FHA 203(k) loans are costlier long-term, but are a good alternative to conventional rehab loans for clients who are not eligible.
Get Started Today
At Land Run Mortgage, we provide the personal attention we believe every client deserves. If you are considering a conventional rehab loan or other type of mortgage, contact us today. We work with clients in Oklahoma City, Edmond and surrounding Oklahoma communities. We can answer your questions about conventional rehab loans and schedule a complimentary consultation.