You best course of action is to apply for a home renovation loan program that enables you to refinance your existing mortgage and include the cost of significant home renovations in your new loan. While these "fixer-upper" mortgage programs are typically used to buy a home, borrowers can also use them to refinance and pay for major home upgrades with a single mortgage. We provide a summary of fixer-upper mortgage programs as well as comprehensive overviews of the most common programs including the FHA 203(k) Program and the Fannie Mae HomeStyle Renovation Program. Additionally, if you are in the military or a veteran you may be able to use a cash-out VA Loan to pay for your home improvements. All three of these programs permit relatively high loan-to-value ratios (95% or greater) which may allow you to qualify for a larger loan amount to pay for your improvements.
We always recommend that you contact multiple lenders to understand how they would handle your unique situation. You can review lenders in your area by clicking INTEREST RATES We advise you to contact at least four lenders as as qualification guidelines vary. When you contact lenders be sure to ask about the FHA 203(k), Fannie Mae HomeStyle Renovation and cash-out VA loan programs. Shopping lenders is also the best way to save money on your mortgage.