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Renovate Smarter with HomeStyle® Financing
If you’re thinking about financing home improvements, you’ve likely come across a variety of options, but what are the best choices for renovation or energy-efficient upgrades? Fannie Mae’s HomeStyle® Renovation and HomeStyle® Energy loans offer flexible and streamlined financing options to make your home more functional, sustainable, and valuable.
Here’s what you need to know about these programs:
HomeStyle® Renovation for Repairs and Upgrades
The HomeStyle® Renovation mortgage allows borrowers to finance repairs, renovations, or upgrades within a conventional first mortgage. This option provides an efficient alternative to second mortgages or home equity lines of credit, saving borrowers the added cost of multiple loans.
According to Fannie Mae’s guidelines, the HomeStyle® Renovation loan offers:
Up to 75% of the lesser of the purchase price plus renovation costs or the “as-completed” appraised value for purchase transactions.
A maximum loan-to-value (LTV) ratio of 97% for one-unit, primary residences for purchase or limited cash-out refinance transactions.*
This means borrowers can finance a wide range of projects—from interior remodels like kitchens or bathrooms to exterior improvements such as landscaping or mudroom additions. Even manufactured homes are eligible, with renovation funds capped at $50,000 or 50% of the “as-completed” appraised value.
One key feature of this loan is the flexibility it provides. Lenders can release up to 50% of material costs upfront to cover project expenses like architect fees, design, or permits—ensuring your project starts smoothly.
HomeStyle® Energy for Efficiency and Resilience
The big takeaway? So far this year, there’s been a much healthier pace of price growth compared to the With the growing emphasis on sustainability, the HomeStyle® Energy mortgage is designed to help homeowners increase their energy efficiency and reduce utility costs. It covers upgrades that make homes more resilient to natural disasters or more environmentally friendly, all while offering a cost-effective way to finance these improvements.
Borrowers can use the HomeStyle® Energy mortgage to finance up to 15% of the “as-completed” appraised value of their home for energy-related improvements. This could include installing solar panels, improving water efficiency, or even addressing radon remediation. In addition, homeowners can finance up to $3,500 for weatherization without requiring an energy report.
Another benefit? This loan also allows borrowers to pay off existing, higher-interest energy-related debt, such as Property Assessed Clean Energy (PACE) loans, making it a versatile solution for improving home sustainability.
What This Means for You
If you’re planning a renovation or seeking to improve your home’s energy efficiency, both HomeStyle® Renovation and HomeStyle® Energy loans offer straightforward and affordable financing options. By consolidating renovation costs into a single mortgage, homeowners avoid the complexities of secondary loans, making the process easier to manage.
Whether you’re modernizing your space, reducing utility costs, or protecting your home from natural disasters, these loan programs give you the financial flexibility to make it happen.
Bottom Line
Financing your home improvement projects doesn’t have to be complicated. With HomeStyle® Renovation and HomeStyle® Energy loans, you can fund repairs, upgrades, or energy-efficient improvements in one simplified process. If you’re considering renovations or want to make your home more sustainable, connect with a licensed mortgage professional to explore your options today.
*For LTVs over 95%, first-time homebuyers must be present unless the loan is combined with HomeReady®; limited cash-out refinances must be owned or securitized by Fannie Mae.
