Buy or refinance a Colorado Springs home and roll the repair costs into one mortgage. A renovation loan lets you turn a dated listing, a fixer-upper, or your current house into the home you actually want — without a separate high-rate construction loan or a maxed-out credit card. As a local broker, 719 Lending shops FHA 203(k), Fannie Mae HomeStyle, and Freddie Mac CHOICERenovation programs to match your project and budget. Rated 4.9★ on Google. (NMLS #1601989, Equal Housing Lender.)
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What is a renovation or rehab loan?
A renovation loan finances both the purchase (or refinance) of a home and the cost of fixing it up in a single mortgage. Instead of borrowing against the home as it sits today, the appraiser values it on an “as-completed” basis — what the home will be worth once your planned improvements are done. The repair funds are held in escrow and released to your contractor as the work is completed. The three programs we use most:
- FHA 203(k) Limited — for cosmetic and non-structural work (paint, flooring, kitchens, baths, roofing, HVAC, appliances). Repair costs are generally capped at $75,000 and no HUD consultant is required.
- FHA 203(k) Standard — for larger or structural projects (room additions, foundation work, moving walls, full gut renovations, bringing a home up to code). There is no fixed repair cap beyond your area’s FHA loan limit, and an FHA-approved 203(k) consultant is required to oversee the project.
- Fannie Mae HomeStyle & Freddie Mac CHOICERenovation — conventional options that finance most projects costing up to 75% of the home’s as-completed value. These work for primary residences, second homes, and (with adjusted terms) investment properties.
Renovation loans in Colorado Springs & El Paso County
Much of El Paso County’s housing stock — older neighborhoods like the Old North End, Patty Jewett, Knob Hill, and Stratton Meadows, plus mid-century homes across the wider Springs — offers great bones at a lower price than new construction in Banning Lewis Ranch or Briargate. A renovation loan lets you compete for those dated listings, then update them on your timeline. It’s also a fit for foothill and Black Forest properties that need well, septic, or energy-efficiency work. Because we’re local, we know which appraisers and contractors understand the “subject-to-completion” process here and can keep your file moving.
Benefits
- One loan, one closing, one monthly payment — purchase plus repairs combined.
- Finance improvements based on the home’s future value, not just its current condition.
- Often a lower rate than personal loans, HELOCs, or credit cards used for renovations.
- Turn an affordable fixer-upper into a move-in-ready home and potentially build equity.
- Refinance-and-renovate option lets current owners tap one loan to update the home they already own.
- Low-down-payment paths available through FHA and conventional first-time-buyer programs.
Eligibility & requirements
- Credit: FHA 203(k) generally starts around a 580 score for the standard 3.5% down payment; HomeStyle and CHOICERenovation typically require 620 or higher.
- Occupancy: FHA 203(k) is for owner-occupants; conventional programs allow primary, second-home, and investment use with adjusted terms.
- Down payment: as low as 3.5% on FHA and as low as 3% on HomeStyle for eligible first-time buyers.
- Property: most 1–4 unit homes; the property must meet program and appraisal standards.
- Contractor: licensed, insured contractors are used for the work; HomeStyle generally allows borrowers to complete a limited share of the work themselves on one-unit properties, subject to lender approval.
- Scope: a detailed bid and renovation plan are required before closing so funds can be escrowed.
These are general guidelines — the easiest way to see if your scenario fits is to check your eligibility with us.
The process in Colorado Springs
- Get pre-approved. We review your credit, income, and goals and confirm which renovation program fits your project. Start your pre-approval online.
- Find the home & scope the work. With your agent, identify the property and gather a detailed contractor bid for the improvements.
- As-completed appraisal. An appraiser values the home as if the planned work is already finished, which helps set your loan amount.
- Underwrite & close. We finalize the loan, escrow the repair funds, and close — combining purchase/refinance and renovation in one transaction.
- Renovate & draw. Your contractor completes the work and is paid from escrow as milestones are inspected.
How renovation loans compare to other options
Not every buyer needs a renovation loan. If the home is already move-in ready, a standard program may be simpler and faster. Compare your choices:
- FHA loans — the base program behind the 203(k); a fit for lower credit scores and low down payments.
- Conventional fixed-rate loans — the foundation for HomeStyle and CHOICERenovation financing.
- First-time home buyer programs — often pair with low-down renovation options.
- Low-down-payment options — if cash to close is your main concern.
- See all loan options »
Why Colorado Springs chooses 719 Lending
We’re a local broker, not a call center. That means we shop multiple investors to find the right renovation program for your project, explain the draw and inspection process in plain language, and stay reachable by phone or text from pre-approval through your final contractor payment. See what our clients say on our reviews page.
Renovation loan FAQ
What is the difference between a 203(k) Limited and Standard loan?
The FHA 203(k) Limited is for cosmetic and non-structural repairs such as flooring, paint, kitchens, baths, roofing, and HVAC, with repair costs generally capped at $75,000 and no required consultant. The Standard 203(k) handles larger and structural projects like additions, foundation work, or full gut renovations, has no fixed repair cap beyond your local FHA loan limit, and requires an FHA-approved consultant to oversee the work.
Can I buy a fixer-upper in Colorado Springs with a renovation loan?
Yes. Renovation loans finance the purchase price plus the cost of repairs in one mortgage, based on what the home will be worth after the work is done. It is a common way to buy dated homes in established El Paso County neighborhoods and update them on your timeline.
How much down payment do I need for a renovation loan?
It depends on the program. FHA 203(k) can go as low as 3.5% down for eligible borrowers, and Fannie Mae HomeStyle offers as little as 3% down for qualifying first-time buyers. Investment and second-home scenarios require more. We review your numbers to see what you may qualify for.
Can I refinance my current home and renovate at the same time?
Yes. Renovation programs allow a refinance-and-renovate option, so current owners can replace their existing mortgage and finance improvements in a single loan rather than taking out a separate second loan or line of credit.
719 Lending, NMLS #1601989, Equal Housing Lender. This is not a commitment to lend; all loans are subject to credit approval and property appraisal. Program guidelines, repair caps, down-payment minimums, and credit requirements are set by FHA, Fannie Mae, and Freddie Mac and vary by program, occupancy, and property type. Figures and program terms are current as of 2026 and subject to change without notice. FHA 203(k) loans require an owner-occupant borrower and, for Standard 203(k), an FHA-approved consultant. Not all applicants will qualify. Contact us to check your eligibility.