Homestyle is a Fannie Mae product that duplicates the FHA 203k renovation program, but is much better. This product lends additonal money for repairs or improvements, added to the mortgage amount, to be borrowed and completed AFTER the close of escrow allowing the loan to close before the improvements are completed. A bid for the work is supplied to the lender and then this amount is added to the loan amount and paid for in draws as work is completed after escrow closes.
Diferfences between FHA 203k and Homestyle renovation
Can build addiotnal units on property up to 4 units?
FHA: Yes Homestyle: Yes
Can loan on rental propertue and 2nd homes?
FHA: No, only primary residence Homestyle: Yes
Is Mortage Insurance is required on all loans regardless of laon to value?
FHA: Yes Homestyle: No, only on loans over 80% Loan to value
Are interest rates the same on both products?
No, Homestyle rates are better.