Home Improvement Lending Center

A home improvement loan may help you pay for simple jobs or more complex remodeling to renovate your home. Financing may be tax deductible (consult your tax advisor on the deductibility of interest). And monthly payments are typically lower than credit cards or personal loans because the cost is spread over the entire length of your loan.

Perhaps you’d like to:

• Update a home’s features or enjoy more living space while remaining in a familiar neighborhood. 
• Make a home more accessible or create a separate living area for another family member. 
• Personalize your home to fit your lifestyle by finishing a basement or adding an attic bedroom.
• Buy a foreclosure or a short sale and plan improvements to make the home fit your needs and tastes.
  
  

  Myth

  If I buy a home, I won’t have money to do repairs.

  Truth

  The Wells Fargo Renovation Loan allows you to purchase your home and finance repairs in one transaction.

   

Wells Fargo has a variety of ways to finance both your mortgage and your home improvements. Our renovation specialists are available to answer any questions.

Find a property

These tips can help you select a home that meets your needs.

• Determine and prioritize what you want in a home using the home wish checklist.
  
• Look for a house with “good bones,” that is structurally sound. 
• Have a reputable home inspector evaluate your home. 
• Talk to a knowledgeable real estate agent to research recent sales prices of local houses. 
• Get an estimate of improvements. Search the internet for information about home improvement costs for your region of the country, as these numbers vary. 
• Add your improvements to the estimated value of your home to make sure you don’t over-improve. When it is time to sell, it will be easier to recoup your costs if your home is comparable in price to other properties in your neighborhood. 
• Consider how long you intend to live in a home, the time and effort required for your renovation, the availability of other homes in the area, and where you’ll live during the improvements, if necessary.

Hire a contractor

Once you’ve found the home you want and your purchase offer is accepted, you’re ready to select a contractor. Depending on the type of home-improvement loan you choose, your lender may require that you use a professional contractor to perform the work. Here’s why: 

• Lenders want to ensure that they’re financing professional work that will not decrease the home’s marketability.
• The loan amount is calculated to include labor costs for the specified projects, and do-it-yourself (DIY) efforts are not eligible.
• A one-year warranty from the contractor is usually required by the lender — something that a do-it-yourselfer can’t provide.
• Lenders also need to be assured that the project will be completed in a timely and professional, workmanlike fashion.

It’s best to get a few estimates before selecting a contractor for the job. Our renovation specialists cannot make these recommendations. Speak with friends and neighbors, as well as your real estate agent.

Select a contractor:

• Focus on the quality of work; don’t just pick the contractor offering the lowest price. 
• Request references from previous customers. Ask about: 
  • the quality of labor and materials, 
  • if the contractor cleaned up after the job, 
  • whether they got the necessary permits, and 
  • if the person would hire this contractor again.
• Make sure you feel comfortable working with your contractor and you can communicate well with each other. 

The contractor you select will submit a detailed estimate along with our validation documents to our renovation specialist. We’ll also verify the contractor’s credentials to be certain that they have a reputable background. This is a detailed check that includes checking supplier references, looking for any contractor liens and bankruptcies, and confirming insurance and licensing.

These are a few key differences you may expect with renovation financing. 

Appraisal 

The appraiser reviews the contractor’s bid, evaluates the home considering work to be completed and provides the lender with an after-improved value. 

After your loan closes 

• After closing, the contractor can begin the work. 
• If you have an FHA 203(k) loan, periodic inspections of the work must be performed before funds are released (inspections may also be required for other loans.) 
• Our draw department will assist you throughout the draw phase. 
• At the end of the project a final inspection is performed and the final funds are disbursed. Then it’s time to enjoy your home!