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8 Best Mortgage Lenders for Home Improvement Loans of 2020

NerdWalletMay 28, 2020

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Looking to pay for home improvements? NerdWallet picked the best lenders in five categories to help you have a first-rate experience and get the best rates.

When you need to make improvements on a house, there’s more than one way to pay for it. Whether you own the house already or you’re buying a fixer-upper, and whether you’re building an addition or you’re merely renovating a bathroom, you have plenty of options for financing the work if you’re not paying for it out of savings.

NerdWallet researched dozens of prominent mortgage lenders to identify which are among the leaders in five categories of lending for home improvement projects. Happy hammering!

Summary of Best Mortgage Lenders for Home Improvement Loans of 2020

LenderNerdWallet Rating National / RegionalMax LTVLearn More

SunTrust

Best for: Best HELOC lenders

National

89.9%

Read review

Flagstar

Best for: Best HELOC lenders

National

89%

Read review

Rocket Mortgage

at Rocket Mortgage

Best for: Best cash-out refinance lenders

National

N/A

at Rocket Mortgage

Veterans United

at Veterans United

Best for: Best cash-out refinance lenders

National

N/A

at Veterans United

PrimeLending

Best for: Best Fannie Mae HomeStyle lenders

National

N/A

Read review

Fairway Independent Mortgage

at Fairway

Best for: Best Fannie Mae HomeStyle lenders

National

N/A

at Fairway

HomeBridge

Best for: Best FHA 203(k) lenders

National

N/A

Read review

New American Funding

at New American

Best for: Best FHA 203(k) lenders

National

N/A

at New American

Our picks for

Best HELOC lenders

A home equity line of credit, or HELOC, acts somewhat like a credit card, using your home as collateral. HELOCs have variable rates, and you tap your equity only when you need it.

SunTrust: NMLS#2915

Logo

National / Regional

National

Max LTV

89.9%


Why we like it

Ideal for homeowners who want flexibility. SunTrust offers a variable-rate HELOC where borrowers can convert all or part of the HELOC balance into a fixed-rate option.

Pros

  • Discount introductory interest rate for initial advances of $25,000 or more.

  • Up to five loans of at least $5,000 each can be converted to a fixed-rate, fixed-term option.

  • Multiple ways to access funds: checks, online, mobile or at a branch.

  • Annual fee waived for Signature Advantage or Premier Banking clients.

Cons

  • Borrower pays closing costs of $100 to $2,000 if account is closed within three years.

  • $65 annual fee.

  • No interest-only payment option during draw and repayment periods.

Read Full Review

Flagstar: NMLS#417490

Logo

National / Regional

National

Max LTV

89%


Why we like it

Ideal for current Flagstar customers. Flagstar offers rate discounts for existing customers with high credit scores who withdraw at least $25,000 at closing.

Pros

  • Multiple draw methods.

  • Line amounts from $10,000 to $1,000,000.

  • No prepayment penalty on home equity loans.

Cons

  • Below average customer satisfaction, according to J.D. Power.

  • Branch locations in only about half of U.S. states.

Read Full Review

Our picks for

Best cash-out refinance lenders

If you have plenty of equity in your home, you can pay for home improvements by refinancing your mortgage for more than you currently owe. You collect the difference in cash; that’s why this form of refinancing is called a cash-out refi. The cash can be used to pay for the renovations.

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at Rocket Mortgage

Rocket Mortgage: NMLS#3030

Logo

Min. Credit Score

620

National / Regional

National

at Rocket Mortgage


Why we like it

Ideal for refi borrowers with little time. Rocket Mortgage brings smartphone app convenience to the refinance process. And online income and asset verification speeds the process.

Pros

  • Offers conventional and government-backed refinance mortgages.

  • Customized loan recommendations based on refinance goals.

  • Automatically fills in your application with public information.

  • Helpful mortgage bankers are just a click away.

Cons

  • Doesn’t consider alternative-credit info for refinances.

  • No in-person customer service available.

  • Must create an account to see personalized refinance rates.

Read Full Review
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at Veterans United

Veterans United: NMLS#1907

Logo

Min. Credit Score

660

National / Regional

National

at Veterans United


Why we like it

Ideal for military-connected customers looking to refinance. Veterans United's streamline VA refis require a lot less paperwork with lower closing costs.

Pros

  • Offers VA IRRRL, or “Streamline,” and cash-out refinance loans.

  • Online application and prequalification available.

  • Offers 24/7 customer service.

Cons

  • Doesn’t publish refinance rates on its website.

  • Must provide some personal information for a customized refinance rate quote.

  • Physical locations not available in all states.

Read Full Review

Our picks for

Best Fannie Mae HomeStyle lenders

A HomeStyle mortgage allows home buyers and refinancers to roll the costs of renovations into the loan. Qualified first-time home buyers can buy with down payments as low as 3%.

PrimeLending: NMLS#13649

Logo

Min. Credit Score

620

Min. Down Payment

3%


Why we like it

Ideal for borrowers with past credit issues and those looking for down payment and closing cost assistance programs.

Pros

  • Low rate of consumer complaints filed with the Consumer Financial Protection Bureau.

  • Offers a "float-down" interest rate lock.

  • Offers a proprietary closing-cost assistance program.

Cons

  • No online mortgage rates.

  • Charges an origination fee.

  • Doesn't offer home equity products.

Read Full Review
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at Fairway

Fairway Independent Mortgage: NMLS#2289

Logo

Min. Credit Score

620

Min. Down Payment

3%

at Fairway


Why we like it

Ideal for borrowers who want lots of options and a quick turn time. Fairway Independent Mortgage offers a full selection of home loans along with a comprehensive mobile app for a fast and easy application process.

Pros

  • A robust suite of loan products.

  • Licensed in all 50 states.

  • Close in as little as 10 days using the Fairway app.

Cons

  • Limited branch locations.

  • Mortgage rates not posted on website.

Read Full Review

Our picks for

Best FHA 203(k) lenders

The Federal Housing Administration’s 203(k) program lets borrowers include renovation costs in an FHA-insured mortgage. The loan amount takes into account the home’s current value, its future value after renovations are completed, and how much the work will cost.

HomeBridge: NMLS#6521

Logo

Min. Credit Score

620

Min. Down Payment

3%


Why we like it

Ideal for borrowers who prefer an online experience. Homebridge offers a variety of home loan options and an online application.

Pros

  • A wide variety of loan types.

  • Low credit score requirements for government-backed loans.

  • A wealth of educational material on its website.

  • Licensed in all 50 states.

Cons

  • Mortgage application can't be tracked online.

  • Charges origination fees on some loans.

  • Limited branch locations.

Read Full Review
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at New American

New American Funding: NMLS#6606

Logo

Min. Credit Score

700

Min. Down Payment

3%

National / Regional

National

at New American


Why we like it

Ideal for borrowers who need to be evaluated on the basis of nontraditional credit. New American Funding offers FHA and VA loans, works with down payment assistance programs, and helps borrowers whose credit histories don't fit the mold of traditional banking.

Pros

  • Uses manual underwriting to evaluate creditworthiness.

  • Offers full online mortgage application, rate quotes, document upload and loan tracking.

  • Home equity lending sets it apart from most non-bank lenders.

Cons

  • Services not available in all 50 states.

Read Full Review

More ways to pay for home improvements

In addition to the mortgage options listed above, homeowners can consider unsecured personal loans that are not backed by collateral such as one’s home. Personal loan interest rates are higher, but borrowers won’t put their homes at risk. Check out NerdWallet's selections for some of the best personal loans for home improvements.

More from NerdWallet

How much is my house worth?

The pros and cons of home equity lines of credit

How much house can I afford?

Last updated on May 28, 2020

Methodology

NerdWallet's selection of mortgage lenders for inclusion here was made based on our evaluation of the products and services that lenders offer to consumers who are actively shopping for the best mortgage. The six key areas we evaluated include the loan types and loan products offered, online capabilities, online mortgage rate information, customer service and the number of complaints filed with the Consumer Financial Protection Bureau as a percentage of loans issued. We also awarded lenders up to one bonus star for a unique program or borrower focus that set them apart from other lenders. To ensure consistency, our ratings are reviewed by multiple people on the NerdWallet Mortgages team.

To recap our selections...

NerdWallet's Best Mortgage Lenders for Home Improvement Loans of 2020