HomeStyle qualification follows conventional underwriting through Desktop Underwriter — DU Approve/Eligible only; manual underwriting is not permitted — plus credit, income, assets, occupancy, and LTV against after-improved value, and renovation-specific requirements like contractor bids and a completable scope of work.
Underwriters evaluate the borrower and the renovation plan together — weak credit or an unrealistic scope can stop a file even when the property itself qualifies.
Conventional minimums apply — typically 620+ for many lenders, with better terms at 680 and 740+. Recent bankruptcies or foreclosures follow standard conventional waiting periods.
Stable employment or documented self-employment income must support the fully amortizing payment including taxes, insurance, and PMI. DTI limits follow Fannie Mae and lender overlays.
Standard primary HomeStyle requires 5% down; eligible HomeReady borrowers may put as little as 3% down. Second homes and investments require more. Cash reserves after closing increase with occupancy type and number of financed properties.
Purchase: primary 97% (HomeReady) or 95% standard OO/2–4 unit/manufactured; second 90%; investment 85%. Refi: primary 97% (HomeReady) or 95% OO/manufactured; second 90%; investment 75%.
Licensed contractor bids, a realistic timeline, and improvements that add value must support the after-improved appraisal — not just a wish list.
These are educational snapshots — Luminate Bank overlays and current Fannie Mae selling guides control your actual approval.
| Underwriting | DU Approve/Eligible only |
| Minimum credit | Often 620+ (varies by lender) |
| Minimum loan | $100,000 |
| Primary purchase LTV | 97% HomeReady / 95% standard |
| Second home purchase LTV | 90% |
| Investment purchase LTV | 85% |
| Primary refi LTV | 97% HomeReady / 95% standard |
| Investment refi LTV | 75% |
| Max DTI | Up to 45% (DU may allow higher) |
| Completion timeline | 15 months after closing |
Your intended use of the property drives down payment, reserve requirements, and maximum LTV on the after-improved appraisal.
Primary residence
Highest LTV — up to 97% with HomeReady or 95% standard on purchase; up to 97% HomeReady or 95% on refi. The most common HomeStyle path for Indiana fixer-upper buyers.
Second home
Up to 90% LTV on purchase or refi. Requires documented part-time occupancy, stronger reserves, and typically 10% or more down.
Investment property
Up to 85% LTV on purchase, 75% on refi. Rental remodels need larger equity contribution and post-closing reserves; rental income may offset payment when documented.
Ryan and Steve front-load the renovation review so you know whether HomeStyle clears before you commit to a rehab-heavy contract.
Step 1
Confirm score, tradelines, and any items that need seasoning before conventional approval.
Step 2
Compare purchase price plus bids against projected value and occupancy LTV caps.
Step 3
Ensure bids are from licensed, insured contractors with line-item detail the lender can approve.
Step 4
Run the same property against FHA 203(k) and VA renovation if occupancy and credit suggest another path may win.
How the conventional renovation mortgage works vs. a standard loan.
Property types and occupancy rules that affect qualification.
Scope of work requirements that underwriting will review.
Full program overview and FHA 203(k) comparison.
Baseline conventional qualification before adding rehab.
Compare all purchase-plus-rehab options side by side.
HomeStyle follows conventional credit guidelines — many files start around 620, but stronger scores unlock better pricing and more room on LTV. Ryan and Steve pull your actual profile before quoting a minimum.
Loan amount is based on the lesser of after-improved value or acquisition cost plus renovation costs, subject to conventional LTV limits for your occupancy type. Investment and second homes typically require more equity.
HomeStyle uses standard conventional debt-to-income limits — often up to 45% with strong compensating factors, sometimes higher with automated underwriting approval. Renovation payment is included in the DTI calculation.
No. HomeStyle is a standard Fannie Mae renovation product without AMI caps. Income limits apply to affordable programs like HomeReady, not HomeStyle.
Send your credit snapshot, income docs, and contractor bids — we will confirm conventional rehab eligibility before you go under contract.
HomeStyle is a registered trademark of Fannie Mae. All loans are subject to credit and property approval. Program guidelines, LTV limits, and pricing are subject to change without notice and may not be available in all areas. This website is not affiliated with or endorsed by Fannie Mae, HUD, or any government agency. Information is for educational purposes only and is not a commitment to lend.