Home Improvement Loans explained in detail

Home Improvement Loans

Home improvement loans are designed for individuals who wish to make improvements to their current home. Home improvement loans are a combination refinance and home improvement loan. Any existing loans are paid off and the balance of the home improvement loans proceeds are disbursed in draws as the home improvement is completed. The LTV is determined by using the "As Completed" value of the property. During construction, you make interest only payments on the amount disbursed. Once the home improvement is completed, you begin making your payments based on your permanent mortgage. Email home improvement loans questions

Home Improvement Loans Description and Guidelines

The "Prime Rate" based home improvement loans charge you interest only payments while the home improvement is being made, based on funds disbursed, at an interest rate equal to the "Prime Rate" plus 1% for both this product. This is described as the home improvement loans interest rate. This rate is subject to change and is the rate used to calculate, on a daily moving basis, the interest payable on a monthly basis. Since the interest rate is subject to change on a daily basis, there is no ability to lock in the home improvement loans interest rate. However, you must choose your permanent mortgage program prior to submission of your home improvement loans for underwriting, so your home improvement loans may be underwritten to the parameters of that particular program. As early as the initial application, you may lock in the interest rate of any available permanent product. The length of the lock period must be long enough to complete the construction prior to lock expiration. The maximum LTV is 95% for your principal residence and 90% on a vacation home. Property limitations are owner/occupied primary residences and vacation homes only. Financing for multi family property is available if you occupy one unit but the LTV is limited to 75% for 2 unit properties and 70% maximum for 3-4 unit properties. Approved condominiums are acceptable but changes are restricted to the inside of the unit. No construction financing for investment properties exists at this time.

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These loans are complex. I have attempted to give you basic information, but it is almost impossible to answer all questions here. Please call or send me an email with the specifics of your situation.

We offer the ability to qualify and close your loan into several unique programs for borrowers with non traditional income or asset situations. Please visit my No Docs page.

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As a Certified Mortgage Planning Specialist, I offer an analysis of your situation today can make suggestions on how small changes in how your debt is structured today can have a life changing effect in the years to come. Read more about this free, no obligation service.