Learn how purchase-plus-rehab financing works — one loan for the home and improvements, with FHA 203(k), HomeStyle, and VA options explained.
What Is a Renovation Loan? | The 2 Mortgage Guys
Learn how purchase-plus-rehab financing works — one loan for the home and improvements, with FHA 203(k), HomeStyle, and VA options explained.
What Is a Renovation Loan?
How Purchase-Plus-Rehab Financing Works
At a Glance
Three Renovation Loan Options at a High Level
From Contract to Completed Renovation
Keep Exploring
Related Blog Posts
Frequently Asked Questions
Get Pre-Approved for a Renovation Loan
A renovation loan lets you buy or refinance a home and finance eligible improvements in one mortgage. Instead of draining savings for repairs after closing, rehab funds are built into the loan and released as work is completed.
You close on one mortgage that covers the home price (or payoff on a refinance) plus an approved renovation budget. The lender bases the loan on the after-improved value — what the property should be worth when the work is done — not just its current condition.
Renovation dollars are not handed to you at closing. They are held in a rehab escrow account and disbursed in draws as contractors complete milestones and inspections pass. That protects you, the lender, and the project timeline.
Ryan and Steve map your scope of work, contractor plan, and program rules before you write an offer — so you know whether FHA 203(k), HomeStyle, or VA renovation is the cleanest path for that fixer-upper.
Each program wraps purchase or refinance and rehab into one closing — but occupancy, down payment, and project size rules differ.
Understanding the draw process helps set realistic expectations before you shop for a project home.
Step
Related guides to help you compare options and move toward pre-approval.
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Recent articles on renovation loans, FHA 203(k), and fixer-upper financing.
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Know your buying power and rehab budget before you shop fixer-uppers. Ryan & Steve can match you to the right program and walk you through the draw process — averaging a 20-day close on straightforward files.
- window.open('https: Renovation Overview How Purchase-Plus-Rehab Financing Works You close on one mortgage that covers the home price (or payoff on a refinance) plus an approved renovation budget. The lender bases the loan on the after-improved value — what the property should be worth when the work is done — not just its current condition. Renovation dollars are not handed to you at closing. They are held in a rehab escrow account and disbursed in draws as contractors complete milestones and inspections pass. That protects you, the lender, and the project timeline. Ryan and Steve map your scope of work, contractor plan, and program rules before you write an offer — so you know whether FHA 203(k), HomeStyle, or VA renovation is the cleanest path for that fixer-upper. At a Glance Three Renovation Loan Options at a High Level Each program wraps purchase or refinance and rehab into one closing — but occupancy, down payment, and project size rules differ. From Contract to Completed Renovation Understanding the draw process helps set realistic expectations before you shop for a project home. Keep Exploring Related guides to help you compare options and move toward pre-approval. 2MG Daily Related Blog Posts Recent articles on renovation loans, FHA 203(k), and fixer-upper financing. {blogLoading ? ( ) : blogError ? ( Try Again