Renovating your home? Here's how to apply for a home equity loan

Realizing that it’s possible to turn your current home into a home you love is a great feeling. Discovering the smartest way to do it is even better. Once you know how to qualify for a renovation home equity loan, it’s time to gather everything you need to apply.

Utilize our helpful checklist with all items you need to apply for a renovation home equity loan and get ready to make that dream home of yours a reality.

Items Required for All Home Equity Loans:

2 Most Recent Pay Stubs
2 Years of W-2 Forms
(if you're self-employed, click here for additional requirements)
Additional Requirements for Self-Employed Borrowers: Self-employed borrowers will also need to submit:
• the last 2 years of filed personal federal tax returns, including all schedules and all pages
• any K-1s (if applicable)
• the returns of the partnership or corporation (if applicable)
• the most recent Profit and Loss Statement showing year-to-date revenues and expenses (if applicable)
Proof of Homeowners Insurance
Most insurance companies will provide this immediately after purchasing your policy. They can also provide additional confirmation upon request. Specific to home renovation loans, you will need to ensure you have coverage matching the value of your post-renovation home.
Most Recent Mortgage Statement
Bank Statements for Prior 2 Months

Items Specific to a Renovation Home Equity Loan:

Your Contractor’s Information
This includes basic contact info such as name, address, phone number, email, company website, etc. If you work with RenoFi, we contact your contractor to perform basic due diligence before the lender can approve your loan.
Preliminary or Signed Renovation Contract between you and contractor, with a Detailed Cost Estimate
Lenders require a detailed material and labor line item cost breakdown, along with a clear payment schedule. As a result, you'll need to ensure that you are ready with your renovation contract. You don't need the contract to be signed to apply for the loan, but you will need the fully executed contract, with all of the details agreed, to close.
Renovation Plans to be used by your contractor for the project
Renovation plans may include Architectural plans, Structural plans, Addition plans, Floor plans, Renderings, Front elevation plans or any other designs, drawings, and plans to be used by your contractor for the project, as applicable.

As you collect each documentation required for your renovation home equity loan application, we’re here to answer any questions you may have. Contact RenoFi as you prepare for the next step toward your dream home.

Other information you may be interested in...

• How to Qualify for a Home Renovation Loan - Did you recently discover that a renovation home equity loan is the best way to fund your renovations? We’ll walk you through the key factors that lenders consider, so you know what to expect when you apply.
• What do I need from my contractor to apply for a home equity loan? - Just like no two contractors are exactly the same, neither are their contracts or proposals. And at RenoFi, we’ve seen them all. But in order for us to help put you on the best path to a home you love, there are a few submission requirements necessary in every contract and every proposal/detailed estimate from your contractor that you should know.
• Ways to Raise Your Credit Score Quickly - If a low credit score is preventing you from getting approved for a home loan, there are a few things you can do to bring it up pretty quickly. Depending on what items on your credit report are holding you down, these are some of the fastest strategies to boost your score.
• Why are Fannie Mae Homestyle loans better than FHA 203Ks when renovating? - We walk through the notable differences that make Fannie Mae Homestyle Renovation loans the better choice over an FHA 203K for many homeowners when planning to finance a renovation.
• 3 Reasons Why You Shouldn’t Rely On An FHA 203K Loan for Purchasing & Then Renovating - Before you jump into an FHA 203K loan to finance the purchase and renovations of your new home, you should hear how this once very popular option actually kinda sucks in today’s market. We’ve got three reasons for you.