Renovation Loan Options
Renovation financing combines your purchase or refinance with the cost of improvements into a single loan — one closing, one payment, no separate construction line of credit. The right program depends on the scope of work, the property type, and whether the property will be owner-occupied or held as an investment. Use the tabs below to find the program that matches your project, or contact us to walk through the options before you commit to a property.
Renovation
FHA 203K Limited
The FHA 203K Limited program wraps your purchase or refinance loan and renovation costs into a single mortgage — one closing, one payment, no secondary financing required. Designed for non-structural improvements, it's the simpler of the two 203K options with no HUD consultant required and a streamlined draw process. Ideal for borrowers updating kitchens, bathrooms, flooring, roofing, HVAC, or making general cosmetic improvements to an owner-occupied property.
Eligible repairs include:
- Kitchen and bathroom remodels — cabinets, countertops, fixtures, appliances
- Flooring — hardwood, tile, carpet, vinyl
- Interior and exterior painting
- Roofing, gutters, and downspouts
- Windows and doors
- HVAC systems — heating, ventilation, and air conditioning
- Plumbing updates and repairs
- Electrical updates and panel upgrades
- Energy efficiency improvements — insulation, weatherproofing, solar
- Accessibility improvements for disabled occupants
- Health and safety repairs required by appraisal
- Decks, patios, and porches
- Basement waterproofing and finishing
- Septic system repairs
Not eligible:
- Structural or foundation repairs
- Additions to the property
- Luxury items — pools, outdoor kitchens, tennis courts
- Any work expected to take more than six months
- DIY repairs — licensed contractor required
- Single closing — renovation and permanent FHA financing combined into one loan
- Maximum renovation costs: $75,000
- Down payment: 3.5% minimum
- Minimum FICO: 580
- Eligible properties: 1-4 units, townhomes, condos, manufactured homes
- Owner-occupied only
- No HUD consultant required
- Up to 3 contractors allowed
- 10-20% contingency reserve required
- Seller contributions up to 6%
- FHA county loan limits apply
Draw structure: Up to 50% of renovation funds released at closing. Remaining balance released after inspection confirms work is 100% complete. Checks co-payable to borrower and contractor.
FHA 203K Standard
The FHA 203K Standard program is designed for substantial rehabilitation projects — structural repairs, additions, conversions, and teardowns rebuilt on existing foundations. It carries no maximum renovation cost beyond FHA county loan limits, making it the right tool for properties that need significant work before they're habitable. A HUD-approved 203K consultant is required to oversee the project from scope development through final inspection.
Eligible repairs include:
- Everything covered under the FHA 203K Limited program
- Structural repairs and foundation work
- Room additions and property expansions
- Full gut renovations and complete interior overhauls
- Conversions — converting a single unit to multi-unit or vice versa
- Teardowns rebuilt on existing foundation
- Adding or repairing attached ADUs
- Repair to existing swimming pools
- Roofing replacement including structural roof repairs
- Major plumbing and electrical system overhauls
- Septic system replacement
- Well repair or replacement
- Grading and landscaping directly related to structural repairs
- Lead paint remediation and mold remediation
- Accessibility modifications including elevator installation
Not eligible:
- Luxury items unless already existing in the property
- Improvements that don't become a permanent part of the property
- New construction on a new foundation
- DIY repairs — licensed general contractor required
- Any improvement that solely benefits commercial functions of the property
Criteria
- Single closing — renovation and permanent FHA financing combined into one loan
- Minimum renovation costs: $5,000
- No maximum renovation cost — FHA county loan limits apply
- Down payment: 3.5% minimum
- Minimum FICO: 580
- Eligible properties: 1-4 units, townhomes, condos, manufactured homes
- Owner-occupied only
- HUD 203K consultant required
- One general contractor required
- 10-20% contingency reserve required
- Seller contributions up to 6%
- Up to 6 months of mortgage payments financeable into the loan during renovation period
- FHA county loan limits apply
Draw structure: Draws released in up to 5 installments as work is completed and inspected by the HUD consultant. A 10% holdback required at each draw, released with final draw upon receipt of clean title update. Checks co-payable to borrower and contractor.
Fannie Mae HomeStyle
The Fannie Mae HomeStyle renovation loan combines purchase or refinance financing with renovation costs into a single conventional mortgage. With the broadest eligible repair list of any standard renovation program — including luxury improvements, mixed-use properties, and investment properties — HomeStyle is the most flexible conventional renovation option available. A single general contractor is required, and on limited approved scopes a borrower-builder option is available for owner-occupants who want to manage their own renovation.
Eligible repairs include:
- Everything covered under FHA 203K programs
- Luxury improvements — swimming pools, outdoor kitchens, high-end finishes
- Structural repairs and additions
- Full gut renovations and complete interior overhauls
- Conversions and property reconfigurations
- Teardowns rebuilt on existing foundation
- Adding or repairing ADUs — accessory dwelling units
- Mixed-use properties — minimum 51% residential use required
- Energy efficiency improvements
- Landscaping and site improvements
- Detached garages and outbuildings
- Roofing replacement including structural repairs
- Major plumbing and electrical system overhauls
- Lead paint and mold remediation
- Accessibility modifications
Ineligible repairs:
- Razing existing structure to build a new dwelling
- Non-permanent items or personal property
- DIY repairs unless borrower-builder option is approved
- Work that solely benefits commercial component of mixed-use property
Criteria
- Single closing — renovation and permanent conventional financing combined into one loan
- No minimum renovation cost
- Renovation costs capped at 75% of after-completed appraised value
- Down payment: 3% minimum primary with HomeReady HomeStyle, 5% standard primary, 10% second home, 15% investment
- Maximum LTV: 97% primary, 90% second home, 85% investment purchase, 75% investment rate-term refi
- Minimum FICO: 620
- Eligible properties: single-family, condos, townhomes, 2-4 units, manufactured homes, mixed-use
- Available for primary residences, second homes, and investment properties
- One general contractor required
- Borrower-builder allowed on approved limited scope
- 10-20% contingency reserve required
- Seller contributions vary by LTV — up to 9% primary, 2% investment
- Up to 6 months of mortgage payments financeable into the loan during renovation period
- Conforming loan limits apply
Draw structure: Up to 50% of materials cost released at closing — maximum $15,000. Up to 5 draw installments as work is completed and inspected. A 10% holdback at each draw released with final draw upon project completion.
Mixed-use note: Property must be at least 51% residential use. Common examples include a storefront with a residential unit above, a live-work property with a small business ground floor, or a property with an attached commercial space. The residential portion must be owner-occupied on primary residence transactions. Renovation financing applies to the entire property including the commercial component.
Freddie Mac Choice Renovation
The Freddie Mac Choice Renovation loan combines purchase or refinance financing with renovation costs into a single conventional mortgage. Similar in structure to the Fannie Mae HomeStyle program, Choice Renovation offers a few distinct advantages — most notably the ability to use ADU rental income for qualification purposes, making it particularly valuable for borrowers adding an accessory dwelling unit to increase both property value and cash flow. Available for primary residences, second homes, and investment properties with no minimum renovation cost requirement.
Eligible repairs include:
- Cosmetic updates — kitchens, bathrooms, flooring, painting
- Structural repairs and foundation work
- Room additions and property expansions
- Full gut renovations and complete interior overhauls
- Building or repairing ADUs — rental income from ADU may be used for qualifying
- Energy efficiency improvements — insulation, solar, weatherproofing
- Roofing replacement including structural roof repairs
- Windows and doors
- HVAC, plumbing, and electrical updates
- Accessibility improvements for disabled occupants
- Decks, patios, and porches
- Luxury improvements — swimming pools, high-end finishes
- Lead paint and mold remediation
- Landscaping and site improvements directly related to renovation
- Paying off short-term financing from prior renovations
Not eligible:
- Razing existing structure to build a new dwelling
- Non-permanent items or personal property
- DIY repairs — licensed general contractor required
- Work that doesn't add permanent value to the property
Criteria
- Single closing — renovation and permanent conventional financing combined into one loan
- No minimum renovation cost
- Renovation costs capped at 75% of after-completed appraised value
- Down payment: 3% minimum primary residence, 10% second home, 15% investment
- Minimum FICO: 620
- Eligible properties: single-family, condos, townhomes, 2-4 units, manufactured homes
- Available for primary residences, second homes, and investment properties
- One general contractor required
- ADU rental income may be used for qualifying
- 10-20% contingency reserve required
- Seller contributions vary by LTV — up to 9% primary, 2% investment
- Conforming loan limits apply
Draw structure: Up to 50% of materials cost released at closing — maximum $15,000. Up to 5 draw installments as work is completed and inspected. A 10% holdback at each draw released with final draw upon project completion.
ADU income note: If the renovation includes building or repairing an accessory dwelling unit, the projected rental income from the ADU may be used to help qualify for the loan. This is a meaningful advantage over other renovation programs and can significantly improve debt-to-income ratios for borrowers adding rental units to their property.
VA Renovation
The VA Renovation loan extends the full benefits of VA financing — including no down payment and no monthly mortgage insurance — to purchase and refinance transactions that include renovation costs. Available exclusively to eligible veterans, active-duty service members, and qualifying spouses, this program combines the strength of VA financing with the flexibility to buy a property that needs work and finance the repairs in the same loan. All renovation work must be completed within six months of closing — no exceptions.
Eligible repairs include:
- Health and safety repairs required by appraisal or VA guidelines
- Cosmetic updates — kitchens, bathrooms, flooring, painting
- Roofing replacement and repair
- Windows and doors
- HVAC, plumbing, and electrical updates
- Energy efficiency improvements
- Accessibility improvements for disabled veterans
- Decks, patios, and porches
- Basement waterproofing and finishing
- Building or repairing ADUs — up to $100,000 total renovation budget
- Lead paint and mold remediation
- Septic system repairs
- Well repair or replacement
Not eligible:
- Substantial structural or foundation repairs
- Luxury items — pools, outdoor kitchens, tennis courts
- Commercial improvements
- Any work expected to take more than six months
- DIY repairs — licensed general contractor required
- Borrower may not act as general contractor
Criteria
- Single closing — renovation and permanent VA financing combined into one loan
- Must be an eligible veteran, active-duty service member, or qualifying spouse
- Certificate of Eligibility (COE) required — we can help obtain this
- No down payment required
- No monthly mortgage insurance
- Maximum renovation costs: $100,000
- All work must be completed within 6 months — no exceptions
- Minimum FICO: 600
- Eligible properties: 1-4 units, VA-approved condos and townhomes, manufactured homes
- Owner-occupied only
- One general contractor required
- Borrower may not act as general contractor
- Minimum 10% contingency reserve required
- Seller contributions up to 4%
- VA funding fee applies — varies by down payment and prior VA loan usage
- VA county loan limits apply
Draw structure: Up to 50% of materials cost released at closing — maximum $15,000. Remaining renovation funds released in draw installments as work is completed and inspected. A 10% holdback at each draw released with final draw upon project completion and final inspection.
USDA Renovation
The USDA Renovation loan extends the 100% financing benefit of the USDA program to purchase and refinance transactions that include renovation costs — combining acquisition and rehabilitation into a single loan with no down payment required. Available for eligible rural and suburban properties that meet USDA geographic and income guidelines, this program is one of the only renovation loan options that offers zero down payment financing. Single-unit properties only — condos, townhomes, and manufactured homes are not eligible under this program.
Eligible repairs include:
- Health and safety repairs required by appraisal or USDA guidelines
- Cosmetic updates — kitchens, bathrooms, flooring, painting
- Structural repairs and foundation work
- Room additions and property expansions
- Full gut renovations and complete interior overhauls
- Conversions and property reconfigurations
- Teardowns rebuilt on existing foundation
- Adding or repairing ADUs
- Roofing replacement including structural roof repairs
- Windows and doors
- HVAC, plumbing, and electrical updates
- Energy efficiency improvements — insulation, solar, weatherproofing
- Accessibility improvements for disabled occupants
- Decks, patios, and porches
- Basement waterproofing and finishing
- Septic system replacement
- Well repair or replacement
- Lead paint and mold remediation
- Landscaping directly related to structural repairs
Not eligible:
- Luxury items — pools, outdoor kitchens, tennis courts
- Income-producing conversions beyond eligible ADU guidelines
- Condos, townhomes, and manufactured homes
- 2-4 unit properties
- Investment properties
- New construction on a new foundation
- DIY repairs — licensed general contractor required
- Borrower may not act as general contractor
Criteria
- Single closing — renovation and permanent USDA financing combined into one loan
- No down payment required
- No minimum credit score with AUS approval
- Eligible properties: single-unit properties only — condos, townhomes, and manufactured homes ineligible
- Owner-occupied only
- Property must be in a USDA-eligible rural or suburban area
- Household income limits apply — contact us to verify eligibility
- One general contractor required — borrower may not act as general contractor
- 10-15% contingency reserve required
- Seller contributions up to 6%
- USDA guarantee fee 1.00% upfront, 0.35% annual fee
- 30-year fixed rate only
- USDA loan limits apply
Draw structure: Draws follow FHA 203K structure — up to 50% of renovation funds released at closing. Remaining balance released in draw installments as work is completed and inspected. A 10% holdback at each draw released with final draw upon project completion and final inspection.
Investor Rehab
Investor rehab loans are structured around the property and project — not your personal income or tax returns. Qualification is based on the as-is value, cost to complete, and after-repair value of the asset, making this the right tool for experienced investors moving quickly on acquisition and renovation opportunities. Loans are interest-only during the project term with draws released as work is completed and verified — keeping your capital efficient throughout the rehab cycle.
Bastion acts as the correspondent lender on these transactions, backed by an institutional capital source. That means you're working directly with us from application through closing — one point of contact, one set of expectations, and a lender who appears on your closing documents rather than a broker passing your file to someone you've never spoken to.
This program is designed for experienced investors with a documented track record. Experienced and institutional borrowers receive the most favorable leverage and terms — the more projects you have completed, the stronger your position at the table.
If you're newer to investment property renovation and don't yet have the track record this program requires, we maintain direct relationships with private lenders who work with less experienced borrowers. We can evaluate your project and personally pitch it to the right capital source on your behalf — the same deal structure, just a different path to funding. Contact us to discuss where your project fits.
Light Rehab vs Heavy Rehab: Light rehab covers projects where renovation costs are less than 30% of the as-is value — cosmetic updates, unit turns, and value-add improvements. Heavy rehab applies when renovation costs equal or exceed 30% of the as-is value, covering substantial gut renovations and structural work. The loan structure and leverage available differs between the two — contact us to determine which category your project falls into.
Criteria
- Non-owner-occupied investment properties only — business purpose loan
- Borrowing entity required — LLC, LP, corporation, or sole proprietor
- Minimum loan amount: $125,000
- Maximum loan amount: up to $3,000,000 for 1-4 units
- Loan terms: 9 to 18 months, fixed rate, interest only
- Light rehab — experienced borrowers: up to 85% LTAIV / 85% LTC / 75% LTARV
- Heavy rehab — experienced borrowers: up to 85% LTAIV / 85% LTC / 70% LTARV
- Institutional borrowers: up to 90% LTAIV / 95% LTC / 75% LTARV on light rehab
- Minimum FICO: 660 with full guaranty, 700 without
- Minimum 10% borrower equity required
- Experience levels recognized: institutional, experienced, and first-time investors
- Base rate 9.25% — subject to change based on market conditions
- Pricing adjusts based on experience, LTC, and project type
Eligible property types:
- Non-owner-occupied 1-4 residential units
- Multifamily on exception basis — subject to additional review and leverage restrictions
Not eligible:
- Owner-occupied properties — business purpose loan only
- Rural property
- Raw unimproved land
- Mobile homes
- Cooperative properties
- Agricultural properties
- Properties in litigation
- Acreage greater than 5 acres
Draw structure: Draws released as work is completed and verified through inspection. Light rehab projects at lower holdback amounts use status inspections — a progress check confirming work is on schedule. Larger or more complex projects use a full fund control draw process requiring invoices, lien waivers, and cost verification before funds are released. Draw type is determined by holdback amount and number of properties.
Not sure which loan is right for you?
Renovation financing wraps your purchase or refinance and improvement costs into a single loan. One closing, one payment, no separate construction line of credit.
Bastion offers renovation financing for both owner-occupied borrowers and real estate investors in Idaho and California, with investor rehab lending available in most states. For owner-occupied purchases and refinances, we originate renovation loans through FHA 203K, Fannie Mae HomeStyle, Freddie Mac Choice Renovation, VA Renovation, and USDA Renovation programs — covering everything from minor cosmetic repairs to full structural rehabilitation. For non-owner-occupied investment properties, we act as correspondent lender backed by an institutional investor, providing flexible renovation financing for fix-and-flip, value-add, and rehab projects across residential property types. Whether you're buying a fixer-upper to call home or rehabbing a property for your portfolio, we'll identify the right program and structure for your project.