At long last we have a widely available renovation program that will cover extensive work, up to $200,000 worth with just 5% down based upon the value after renovation, or 20% for a second home.  The contract with the builder is needed for the appraisal and the project and the builder must be approved.   The total amount borrowed can be up to $417,000 so in the Mid-Atlantic region it’s for urban pioneers, people buying in outlying areas or upgrades in preparation for sale.
 
The obvious applicability is for buyers who would like to include renovations in their purchase financing with a seller who can wait for the additional steps to be completed for loan approval.  The less obvious application is for long-term homeowners with lots of equity in a home that is dated that will be much more valuable and saleable with upgrades completed.  Keep this in mind for those potential listings with dented metal kitchen cabinets and mint green tile in the bathrooms.  I especially like this for people who can stick around and enjoy the renovations for a couple of years before their big move, so remember this when you talk to homeowners who are doing fact-finding for a future move.