When looking for ways to finance their repairs or renovations, many homeowners overlook an important resource: federal, state and local governments.
One of the most popular ways to get help from the government to pay for home improvements is through a federal loan program. This help typically come in the form of:
- Title I property improvement loan insurance.
- 203(k) rehab mortgage insurance.
With the Title I HUD loan, the federal government agrees to insure a home improvement loan for up to $25,000 for a single-family home and $60,000 for a multifamily structure. This makes the loan less risky for lenders, and they may be willing to offer better terms than they normally would, making the improvement cheaper for you.
Unlike Title I home insurance, an FHA 203(k) renovation loan insures not just your home repair costs, but also your mortgage or refinancing. This means that lenders will be more willing to give you better rates on a loan that covers not just the cost of your home but also the cost to improve it.