What renovation loan programs are there?
Five, across two families. On the FHA side: the 203(k) Standard for structural or major rehabilitation, and the 203(k) Limited for smaller, non-structural repairs capped at $75,000. On the conventional side: Fannie Mae HomeStyle Renovation, and Freddie Mac's two options, CHOICERenovation and the streamlined CHOICEReno eXPress for small jobs. All four finance the purchase or refinance plus the renovation in a single loan, and all are underwritten on the as-completed value of the home after the work is done.
FHA 203(k): how do Standard and Limited differ?
Both are for an owner-occupied primary residence; the split is scope. The Limited 203(k) covers non-structural repairs up to $75,000 in total rehabilitation, a consultant is optional, and the work timeline is 9 months. The Standard 203(k) handles structural and major rehabilitation with no fixed dollar cap beyond your county FHA limit and a $5,000 minimum repair, a HUD-approved 203(k) consultant is required, and the timeline is 12 months.
Renovation funds sit in an escrow holdback and release in draws against inspections, with a portion available at or near closing and a final holdback held until the work is certified complete. The specific number of draws is set by a Mortgagee Letter that is still in draft, so I do not state a draw count; the holdback-and-inspection mechanism itself is settled. Contingency reserves are scope-and-age determined rather than a flat percentage.
What is the Fannie HomeStyle Renovation loan?
HomeStyle is the conventional renovation loan. Renovation funds can run up to 75% of the lesser of the purchase price plus renovation cost or the as-completed value (50% for manufactured homes), and the work timeline is 15 months, extendable to 18 by a documented lender extension. Occupancy is broader than FHA: Primary 1-4 units; one-unit second home; one-unit investment (B5-3.2). Up to 50% of renovation costs can fund at closing, and luxury improvements are allowed when permanent and code-compliant.
What are Freddie CHOICERenovation and CHOICEReno eXPress?
They are Freddie Mac's conventional renovation options. CHOICERenovation allows renovation funds up to 75% of the as-completed value with a completion window of 450 days. CHOICEReno eXPress is the small-job variant: renovation funds up to 10% of value (15% in Duty-to-Serve high-needs areas) with a 180-day window. Both allow luxury items when permanent and code-compliant.
One honest limit: occupancy for CHOICERenovation and eXPress follows the Freddie Guide, and the data I rely on does not pin it to a specific occupancy set, so I will not claim a rental qualifies for CHOICERenovation. Confirm occupancy in the Freddie Guide for your scenario before assuming it.
Which renovation program fits which borrower?
Start with occupancy. If it is not your primary residence, FHA 203(k) is out, and you are looking at HomeStyle or CHOICERenovation. Then weigh scope: cosmetic and under $75,000 fits a 203(k) Limited; structural work needs a 203(k) Standard or a conventional loan. Credit matters too, since FHA is more forgiving while conventional rewards stronger profiles by letting mortgage insurance fall away. Finally, luxury items like a pool rule out a new build on FHA and point you to HomeStyle or CHOICERenovation.
What are the headline differences?
Six things separate these programs: eligible improvements (the pool divergence is the clearest, since FHA bars a new pool and allows only repair of an existing one, while HomeStyle and CHOICERenovation allow luxury items when permanent and code-compliant), occupancy, the dollar or percentage limits, the completion timelines, whether a consultant is required, and how contingency reserves work. The table below lays them side by side, with every cell sourced or marked per the Guide.
| Dimension | 203(k) Standard | 203(k) Limited | HomeStyle | CHOICERenovation | CHOICEReno eXPress |
|---|---|---|---|---|---|
| Max reno funds | No fixed cap; within FHA county limit; min $5,000 | $75,000 | 75% of lesser of (price + reno) or as-completed (50% manufactured) | 75% of as-completed value | 10% of value (15% in high-needs areas) |
| Luxury items (pools) | Ineligible (repair existing only) | Ineligible | Allowed (permanent, code-compliant) | Allowed (permanent, code-compliant) | Allowed (permanent, code-compliant) |
| Occupancy | Owner-occupied primary, 1-4 units | Owner-occupied primary | Primary 1-4 units; one-unit second home; one-unit investment (B5-3.2) | Per the Freddie Guide | Per the Freddie Guide |
| Completion timeline | 12 months | 9 months | 15 months (18 by extension) | 450 days | 180 days |
| Consultant | Required | Optional | Not required | Not required | Not required |
| Contingency reserve | Mandatory; scope-and-age determined | Optional | 10% for 2-4 units (up to 15%); optional for 1 unit | Per the Freddie Guide (lender-determined) | 10-20% (at least 15% if utilities are inoperable) |
Go deeper
- The renovation loan process, offer to final draw
- What renovation loans cover, and what they won't
- Budgeting a renovation loan, how much you can borrow
- Your contractor and the loan, what the lender requires
See the renovation loan hub for your financing options.
Related loan program: Renovation loans. See all your renovation financing options on the renovation loan hub.