Minimum credit score 700 with full income documentation no alternative or stated income and a 45% debt to income ratio
- 15% Down if it’s a non owner occupied rental property, if it’s a primary residence you will be owner occupying then it’s no money down
- Primary 1-4 Units / Second Home 1 Unit / Investment 1-4 Units
- No Mortgage Insurance
- No Maximum Renovation Amount (Under Conventional Loan Limits) minimum loan amount of $100,000
- No Title Update / Draw / Inspection Fees During Renovation
- Must open a depository account with a minimum deposit of $50 with Lake Area Bank www.lakeareabank.com
- Approval is subject to “After Completed Value” Appraised value no exceptions. Full payment of appraisal required upfront, appraisal cost increases with multi unit properties.
- Please note no funds will be disbursed prior to 100% of all work submitted in the initial bids and estimates are complete. After successful final inspection all funds will be disbursed to the contractor under contract.
- Must use licensed and insured contractors from our pre-approved list of contractors or a contractor of your choice after committee review (must have strong resume & references) NO PAYMENT MADE FOR SELF WORK
- May need to use the MN Fair Plan for homeowner’s insurance or alternative insurance that may be slightly more expensive if you are doing significant construction.
- Cannot start any work on property until priority pictures are taken by the title company and mortgage has been recorded with the county (24-48 hours after closing)
- Cannot lock into your end loan interest rate until all work is completed, final inspection has occured, and all required personal documents have been received for final loan approval.
- At lock in your rate could be .25% – .375% higher than current market rates
- Borrower is 100% responsible for any overages due to the contractor
- We request all construction work is completed and end loan closes within 90 days
- There are 2 full sets of non negotiable closing costs and points will be necessary if purchasing rental investment property. Full disclosure of all required costs at time of pre-approval will be given.
Reserve Requirements
- Primary residence minimum 6 months
- Vacation home minimum 12 months
- Rental Investment property minimum 12 months on the property being purchased and 6 months on each other mortgaged property
Please note lending criterias are a minimum. All loans must recieve an approve/elligible decision within Fannie Mae’s desktop underwriting system and may require additional requirements than listed here.
