VA Renovation Loan Guide 2025

Buy It. Renovate It. Move In. All with One VA Loan.

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A VA Renovation Loan allows eligible veterans and active-duty service members to purchase a home and finance the repairs or improvements—all under one VA loan, with no down payment. Instead of worrying about separate financing, you can streamline the process and create your dream home from the start.

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How a VA Renovation Loan Works

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• One Loan, One Closing: Purchase the home and finance the renovations together.

• Future Value Appraisal: The VA appraisal estimates the value after the renovations are complete.

• Loan Limit: Your final loan amount is based on the lower of either the combined purchase + renovation costs or the post-renovation appraised value.

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VA Renovation Loan vs Traditional VA Loan

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VA Renovation LoanTraditional VA Loan

Includes funds for repairs & upgrades For purchase or refinance only

Based on future home valueBased on current home value

Requires VA-approved contractorsStandard property requirements

Eligibility & Basic Requirements

• Active-duty military, veterans, or eligible surviving spouses

• Valid Certificate of Eligibility (COE)

• Minimum credit score and financial qualifications

• Primary residence only

• Renovations must be completed within 120 days

• Contractors must be VA-approved

• Property must meet VA standards after improvements are completed

Eligible Renovations

You can use a VA Renovation Loan to fund improvements that make your home safer, more livable, or more energy efficient, such as:

• Roof repairs or replacement

• Heating, cooling, plumbing, or electrical system upgrades

• Energy-efficient upgrades

• Accessibility improvements

• Mold, lead paint, or pest remediation

Note: Major structural changes, room additions, detached structures, and landscaping-only projects typically do not qualify.

Advantages of a VA Renovation Loan

• No down payment

• Competitive VA interest rates

• No private mortgage insurance (PMI)

• Streamlined financing with one loan and one closing

• Improved safety, comfort, and energy efficiency

Things to Keep in Mind

• Renovations must meet VA guidelines

• Limited availability — not all VA lenders offer renovation loans

• Contractors must be VA-approved

• All work must be completed within 120 days of closing

Alternative Options to Consider

• VA Energy Efficient Mortgage (EEM): Up to $6,000 in additional funds for energy improvements.

• VA Cash-Out Refinance: Use existing home equity for renovations.

• Specially Adapted Housing Grant: Available for certain service-connected disabilities.

• FHA 203(k), HELOCs, or Home Equity Loans: For projects outside VA loan guidelines.

Frequently Asked Questions

Is a VA Renovation Loan right for me?
If you want to purchase or refinance a home that needs repairs to meet VA standards or to improve safety, energy efficiency, or livability, a VA Renovation Loan could be a smart solution.

What happens if my renovation costs exceed the appraised value?
Your total loan amount is capped at the lower of either the combined purchase price plus renovation costs or the home's appraised "as-completed" value.

Why don’t all lenders offer VA Renovation Loans?
VA Renovation Loans involve additional paperwork, oversight, and contractor approval, so fewer lenders offer this specialized product.

Your Next Steps

1. Gather contractor bids for the planned renovations.

2. Work with a VA-approved lender experienced in renovation loans.

3. Get a VA appraisal based on the post-renovation value.

4. Close on your loan and start your renovations.

5. Complete all work within 120 days, followed by a final inspection.