A Renovation loan, is a first mortgage that allows you to buy and renovate a home that needs repairs. You only need a 3.5% down payment. Most home buyers do not know about this type of loan.
How does it help you? A renovation loans allows you to make exterior repairs like a new roof or siding replacement. It also allows for interior work, like a new kitchen, new bathrooms and hardwood. There are no limits to the type of home repairs. You can also use it to even add more living space, a porch, garage, etc.
A renovation loan allows you to take ownership of the home through the loan closing process. You can take ownership before repairs are complete. A regular mortgage loan will not allow you to own a home before renovations are complete.