The first step is qualifying for a Mortgage. The purchase price of the home, combined with the total improvement cost, cannot exceed your maximum pre-approved mortgage amount. The combined amount is the “new purchase price.”
Improvements must add value to the home to qualify under the program and vary from lender to lender. The Improvement Cost cannot exceed 20% of the New Purchase Price or exceed $40,000. Some exceptions may be given depending on the scope of the work.
Note: The minimum required down payment is 5% and applies to the “new purchase price.”