VA Renovation Loans
What is a VA Renovation Loan?
The VA Home Renovation loan can turn a fixer-upper into a show stopper.
If you are an eligible veteran, the VA Renovation Loan provides you all the benefits included with a traditional VA loan, such as zero down payment and lower closing costs. In addition you have the ability to roll your renovation costs into the very same loan. It is one loan with one application and one monthly payment. That could save you money when compared to taking a second loan to pay for the renovations.
Can you get a renovation loan with a VA loan?
Similar to VA construction loans, the VA does guarantee loans to buy and renovate existing property. However, there is a rehab loan that most lenders do offer. That's the FHA 203K loan. It's not a VA loan product, so there are down payment requirements as well as monthly mortgage insurance costs.
Is there a VA rehab loan?
Because the VA requires a home to be move-in-ready, deep construction / rehab VA loans are not allowed. However, there is a government insured mortgage program that does allow deep rehab. This program is called the FHA 203K loan.
Can I get a VA loan for home improvements?
Borrowers who have first liens are permitted to apply for cash-out VA refinancing loans and use the money for any purpose "acceptable to the lender" and that could include home improvements. The borrower must have a "first lien" or mortgage on the property in order to apply for refinancing.