Combines with Freddie Mac’s Home Possible or HomeOne to purchase a home with just 3% down payment.Build accessory dwelling units, such as mother-in-law apartments.Provide resilience upgrades to protect an existing home from natural disasters.Finance a home purchase or home renovation with a single fixed-rate or adjustable-rate loan.These programs, however, have differences that are explored later in the article. Fixed rate and adjustable rate mortgagesįreddie Mac’s CHOICERenovation loan has some similarities with the FHA 203 (k) loan and Fannie Mae’s HomeStyle Renovation loan.Īll three loan products offer purchase-and-renovation financing with just a single loan and closing.Instead, it allows borrowers to buy a home and make needed renovations all with a single mortgage loan. In all situations, such loans can require a full-blown closing, and that can mean big costs for such things as legal fees, title insurance, and taxes.įreddie Mac’s CHOICERenovation loan program eliminates the fuss and expense of closing on two loans. Then, later, there’s a second closing for such options as a cash-out refinance, a second loan, a home equity loan, or a home equity line-of-credit (HELOC) to pay for renovations. There’s one closing for acquisition financing. Many borrowers would like to buy and fix up a new home, but traditionally it’s taken two loans – and two closings – to finance such deals. Is a CHOICERenovation loan right for you?
The CHOICERenovation loan can save thousands of dollars in excess closing expenses because you finance your home loan and repairs with a single mortgage. It also allows current homeowners to refinance, wrapping renovation costs into the new loan amount. The CHOICERenovation (sometimes written “Choice Renovation”) mortgage from Freddie Mac gives borrowers the option to buy and fix up homes without the need for two separate loans. Octo8 min read What is the Freddie Mac CHOICERenovation loan?
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