For many homeowners, the desire to renovate runs directly into a financing wall. Traditional HELOCs are limited by your home’s current value—which often falls far short of what a major renovation actually costs. A cash-out refinance preserves access to equity but at the cost of today’s rates. And government renovation loans, while powerful, come with a process that can slow down or complicate your project.
Bluefire Mortgage Group now offers a solution that sidesteps all of these trade-offs: the Renovation HELOC.
What Makes It Different
This product is built on a simple but powerful concept: instead of basing your borrowing limit on what your home is worth today, it’s based on what your home will be worth after the renovation is complete—the After-Renovation Value, or ARV, adjusted to 125% of the value once the project is completed.
That distinction creates significantly more borrowing power for the right borrower. A homeowner with limited current equity can qualify for the full scope of a major project because the lender is underwriting against the finished result, not the starting point.
Key product features include:
- Borrow up to 95% of the after-renovation value
- Second lien position—your existing mortgage rate is not disturbed
- 10-year interest-only draw period, followed by a 20-year repayment term
- Loan amounts from $50,000 up to $750,000
- No traditional draw inspections—funds are accessible directly to pay your contractor
Who This Product Serves
The ARV HELOC was designed for two distinct borrower profiles.
Current homeowners who want to renovate but either lack sufficient equity at today’s value or are unwilling to refinance out of a favorable first mortgage rate. This product allows them to access meaningful renovation capital without touching the underlying loan.
Homebuyers who are purchasing a property that requires renovation. With no ownership seasoning requirement, this Renovation HELOC can be opened immediately after purchase, allowing buyers to finance renovations from day one based on what the property will be worth—not what they just paid for it.
Eligible project types include kitchen and bathroom remodels, room additions, ADUs, roofing, exterior improvements, pools, and more. The product is best suited for renovation scopes of $50,000 and above.
Qualification Overview
Borrowers will need a 640+ credit score and full income documentation. Owner-occupied or second homes are eligible, up to 2 units. A full review of contractor qualifications and project scope will also be required. If you have any questions, give us a call at (760) 930-0569.
