Mortgage Network Rolls Out New Jumbo Renovation Loan Program

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Independent mortgage lender Mortgage Network has introduced a new jumbo renovation loan program that enables homeowners in Massachusetts, Connecticut and New Hampshire to finance the purchase or refinance of a home plus the costs of renovating it, all in one loan.

The new program allows for loan amounts that exceed the current Fannie Mae and Federal Housing Administration county loan limits, including the limits in designated high-cost areas, the lender says in a release.

Loans are available up to $800,000, however, loan amounts of more than $1 million will be considered.

“The Northeast has some of the oldest housing stock in the country and also some of the most expensive homes,” says Laurie Souza, national business development manager for portfolio/renovation lending at Mortgage Network. “We felt there was an underserved market and a need to offer home improvement financing that allowed for loan amounts exceeding the Fannie Mae and FHA limits, while also allowing for features that typically fall outside of the box of traditional construction-permanent financing programs offered by community banks.”

Almost any improvement type is eligible for the program as long as it is permanently affixed to the property and adds value. Eligible improvements include but are not limited to interior and exterior enhancements; cosmetic upgrades such as kitchen or bath renovations; floor plan alterations; roof replacements; plumbing or electrical upgrades; and additions, such as extending the house out or up.

Renovation costs exceeding $50,000 require a licensed general contractor to supervise the work. However, unlike traditional renovation loans, a plan reviewer or HUD consultant is not required.

The Jumbo Renovation Loan program enables borrower down payments as low as 10% based on the lesser of the acquisition cost of the property or the appraised value of the home after the improvements have been made.

Private mortgage insurance is required only if the loan amount exceeds 80% of the property acquisition cost or after-improved value. Borrowers must have a minimum credit score of 680.

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