When done right, the renovation loan process will take 30 days. There are five steps in this process:
- Pre qualification (1 day)
- If buying a new home the offer to purchase the home must be accepted. If renovating our own home or adding on, this is obviously not relevant (1 day)
- List of repairs to be approved and choosing a contractor (10 days)
- Loan approval, appraisal, final conditions for the borrower and renovation (11 days)
- Closing (7 days)
The renovation that follows can range from 30 days to over six months.
Kris Floyd and Pinnacle Renovation Lending spends over 80% of this time working with owners to obtain renovation loans. At New Avenue we are working with them to help owners who are considering 203K loans and remodeling loans. They have the ability to finance the “soft costs” which includes the design and permit fees. You will typically pay these soft costs out of pocket and then be reimbursed once construction begins.
Kris estimates that over 95% of all their renovation loans take frmo 30-45 days to close.