Home renovation

Freddie Mac launches new home improvement mortgage, here’s how to get one

Freddie Mac has announced a new loan product to help homeowners and homebuyers pay for home renovations. (iStock)

Freddie Mac Thursday presented its new mortgage productthe CHOICEReno eXPress Mortgage, which will allow buyers and homeowners to pay for home renovations by financing the project through the purchase or refinancing of their mortgage.

Freddie Mac said it would save buyers and homeowners time and money, and give them the funds they need for low-cost home renovations at no extra cost and with interest rates. reflecting mortgage interest rates, which are currently at historic lows. The loan is closed with their traditional mortgage and combined into one monthly payment.

“CHOICEReno eXPress extends Freddie Mac CHOICERenovation Mortgages, which were designed to help meet the nation’s aging housing supply, address the need for affordable housing, and provide options to renovate, repair, improve or to meet the growing demand for cost-effective financing solutions,” said Danny Gardner, senior vice president of customer and community engagement for Freddie Mac’s single-family business. “CHOICEReno eXPress will help buyers and homeowners to reduce out-of-pocket expenses by offering more affordable loan terms than using credit cards or unsecured financing on small-scale renovations.”

If you want to add the home improvement loan to your purchase or mortgage refinance, visit an online marketplace like Credible to find a lender with lower rates. By comparing mortgage rates from multiple lenders, borrowers can save hundreds of dollars on their monthly payments and leave more room in their renovation budget.

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What is the CHOICEReno eXPress mortgage?

These renovation loan top-ups are available for a maximum loan amount of up to 10% of a home’s value, or up to 15% in high-need rural areas. Later, Freddie Mac will require an inspection to ensure that the renovations have been made.

The loan will allow homeowners to make cosmetic renovations such as window and door replacements, roof repairs, minor renovations and interior or exterior painting with lower interest rates than a personal loan.

Contact a lender and inquire about adding the CHOICEReno eXPress Mortgage to your mortgage purchase or refinance. Visit Credible to be prequalified for a mortgage in minutes without affecting your credit score.

CONGRESS WILL NOT PASS EVICTION MORATORIUM EXTENDED, BUT LANDLORDS AND TENANTS STILL HAVE OPTIONS

What other options are available for home renovations?

The CHOICEReno eXPress Mortgage Loan allows homeowners to combine renovation financing with their mortgage purchase or refinance and bundle it into one monthly payment. However, there are also other options available to homeowners who need money to improve their home.

Personal loans: Although a more expensive option, unsecured personal loans are still relatively inexpensive in a historically low interest rate environment. Homeowners can take out a personal loan to have cash in days to pay for home renovations.

With Credible, homeowners can see multiple lenders and rates at once and find the personal loan that best suits their needs. It only takes a few minutes to qualify.

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Refinancing by collection: Homeowners can also consider cash refinance or even a home equity loan to finance their home improvement project with today’s lowest interest rates. As home prices rise at a record pace, many homeowners have more equity available in their homes to draw cash from. But rather than a loan amount set at 10% of the home’s value, getting a cash refinance typically requires homeowners to own a 20% equity stake in their home after the cash refinance is complete. Visit Credible to talk to a home loan expert and compare your options for withdrawing cash from your home at the lowest rates.

Do you have a financial question, but you don’t know who to contact? Email the Credible Money Expert at [email protected] and your question might be answered by Credible in our Money Expert column.