Whether you grew up watching “This Old House,” you have a knack for restoring and using tools, or you just fell in love with a home that needs a bit of extra TLC, Fairway Independent Mortgage Corporation Fort Lauderdale is here to offer you financing options to pursue your repair dreams. The benefits of purchasing a fixer-upper can span for years after the initial renovation. If you are okay with buying a work-in-progress, you may ultimately be doing yourself a huge favor! The number one reason people often avoid these project homes is their lack of affordability. Though the initial purchase is usually a modest price, the cost of necessary repairs can steer buyers away. However, most people aren’t aware of all the options they have through mortgage loans. Here are a few of them:

FHA 203(k) Loans

Particularly designed for new homeowners who lack extra cash when moving in, this program provides homeowners with both a mortgage and access to money for the necessary improvements. The Federal Housing Administration backs mortgage loans called FHA 203(k) that are available for a low minimum down payment. These mortgage loans — nicknamed “renovation loans” — are specifically for cosmetic repairs and improvements. They even allow a payment delay for the first six months in most situations if you are not able to occupy the home until the project’s completion. Limits for these mortgages vary by state, but your loan officer will be happy to reach out with the specifics for your area.

Home Equity Loans/HELOCs

There are a few options for homeowners who want to remain in their current residence while making some improvements. A type of second mortgage that you can take out on your home, home equity loans are a fixed-rate option in which monthly payments remain the same throughout the loan, without the possibility of fluctuating interest rates. In contrast, HELOC mortgages are a revolving credit option where you can continue to draw for large payments due over time. While both of these options are based on the current balance of your home, as opposed to the projected balance after your home improvement project has been completed, they are great ways to jumpstart the process.

Cash-Out Refinance

In a cash-out refinance, homeowners can refinance the existing mortgage on their home for a higher amount while pocketing the difference. In many cases, the refinance is beneficial in other ways, since a lower rate than the one for the initial home loan might also be available. Depending on the equity built in your current residence, you have the potential to pay for significant repairs with this method, boosting your home’s appraised value.

When purchasing a home, feel free to look at the full potential instead of the home’s present condition. There are many construction loan options to assist in turning your house into the home of your dreams! Give us a call today to get started, and we’ll find the best fit for your situation.