“Construction and Renovations Loans”

       “Construction and Renovations Loans”




Hello Joe,

I hope you are doing well! I’m writing with some different questions than I had last time we caught up.

I’ve moved up at work and have been working 3 days a week from our Boston office, and expect another move up that will keep that going for quite some time. Additionally, I think at some point a few years down the road I’d want to have the flexibility for my mom to move in.

With all that, it seems to make sense to get a bit closer to 84 (to ease the commute) and find something with a bit more room/more amenable layout for future flexibility. Also, it seems like we may be in a sweet spot of having some equity but being able to do something before rates go up more.

For the next house, I definitely want to fulfill my interior design dreams and would want to either go the 203k route (which I feel I know enough about to start looking), but I am also curious about building. It’d be nice to be able to go all out with energy efficiency and not have to worry about major costs for a good period of time.

I did some initial research about construction to permanent loans. What I was hoping to chat about with you would be:


1. What are the big things you think I’d need to know?

2. It sounds like a good down payment is needed and that the lender would want to see some money in the bank to cover two potential payments for when the current home is listed and the new one is finished. How do we go about knowing if we have enough on these fronts?

3. What type of down payment is needed on this type of loan to avoid PMI?

4. Any other underwriting stuff that is “stricter” we’d want to be prepared for? What are the DTI limits?

5. What is the pre-qualification process like here?


I do have a few other 203k questions. The main things I would love to avoid for this next home buying adventure are having to move out of our place before we have a new one (especially because I am confident this would sell quickly) and PMI!

Thanks so much as always Joe!



So many banks, credit unions and lenders just don’t do these loans. Mostly because they are a lot of work, but we do them like breathing. They are easy to do if you know what you are doing. The lenders we use know we know how to do them, so they go smoothly for us.


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Joe Petrowsky, NMLS #6869

Right Trac Financial Group, Inc. NMLS #2709

110 Main St.

Manchester, Ct. 06042

Office: 860 647-7701 x116

Fax: 860 647-8940

Cell: 860 836-9294

Email: joe@righttracfg.com



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Joe Petrowsky does not guarantee nor is in any way responsible for the accuracy of the information provided herein, and provides said information without warranties of any kind, either expressed or implied.

Equal Housing Statement: We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. We encourage and support an affirmative advertising and marketing program in which there are no barriers to obtaining housing becuase of race, color, religion, sex, handicap, familial status, or national origin.

Comment balloon 2 commentsJoe Petrowsky • September 04 2018 02:22PM


Good morning, Joe Petrowsky this statement says it all:

They are easy to do if you know what you are doing. 

Posted by Barbara Todaro, "Franklin MA Homes" (RE/MAX Executive Realty ) 2 months ago

Good morning Joe. A lot of institutions avoid construction and rehab loans like the plague. A great source of referrals for you! Enjoy your day!

Posted by Wayne Martin, Real Estate Broker - Retired (Wayne M Martin) 2 months ago