Purchase Plus Improvements, Explained
How to roll renovation costs into your mortgage before you even move in.
The Purchase Plus Improvements program lets you buy a home and finance the cost of renovations — like a new kitchen, flooring, windows, or a new roof — as part of your mortgage, rather than finding separate financing after closing.
Why it's worth considering
- Available with as little as 5% down
- Avoids higher-rate financing for renovations after you move in
- Opens up older homes you might otherwise skip
- Lets you make a property your own from day one
How it works
You'll need contractor quotes for the planned improvements, submitted to the lender for approval as part of your financing. The mortgage is based on the improved value of the home — purchase price plus the cost of the work — up to a limit of roughly 10% to 20% of the purchase price, depending on the lender and insurer.
For example, on a $300,000 purchase with $30,000 in planned improvements, your mortgage is based on $330,000. With 5% down, that's $16,500 — not $15,000.
What to expect
None of the improvement funds are released until the work is done, so you'll need to cover any contractor deposits yourself in the meantime. Lenders typically require the work to be finished within 120 days, after which an appraiser confirms it's complete before the funds are advanced.