Quick Answer: A HomeStyle Renovation Loan is a mortgage that allows buyers to purchase a home and finance renovations with one loan. The loan amount can be based on the home's value after the improvements are completed. Buying a home that needs repairs can feel overwhelming. Many buyers worry about how they will afford both the purchase price and the renovation costs. What Is a HomeStyle Renovation Loan? A HomeStyle Renovation Loan allows buyers to combine the purchase price of a home and renovation costs into one mortgage. Buy the home Finance renovations Make one monthly mortgage payment Example Home purchase price: $500,000 Renovation costs: $50,000 Total financed amount: $550,000 (subject to loan guidelines) Eligible Properties Single-family homes Townhomes Condos Some manufactured homes Certain owner-occupied multi-unit properties Common Renovation Projects Kitchen remodeling Bathroom upgrades Roof replacement New flooring Heating and cooling systems Energy-efficient upgrades Room additions How Renovation Funds Are Paid Renovation funds are typically placed in a repair escrow account and released in stages as work is completed and inspected. The contractor completes part of the work An inspection confirms progress Funds are released to the contractor Why Buyers Use HomeStyle Loans One loan instead of separate purchase and construction loans Ability to buy homes that need updates Opportunity to customize the home Potential to increase property value Frequently Asked Questions Can renovation costs be included in the mortgage? Yes. Eligible renovation costs can be included in the loan amount if they meet program guidelines and the project is approved by the lender. Do I need a contractor? Most renovation loan programs require a licensed contractor and documented renovation plans. How long do renovations usually take? Many renovation programs require the work to be completed within about 12 months after closing. Disclosure: This information is provided for educational purposes only and is not a commitment to lend. Loan programs and guidelines may change without notice and are subject to borrower qualification and property eligibility.