VA rehab loans allow veterans to finance the purchase and renovation of a home with a single loan, covering essential repairs like roof, HVAC, electrical, plumbing, foundation, flooring, energy efficiency, and accessibility. Cosmetic upgrades are not covered. Loan amounts are based on the after-repair value, and renovations must be completed within 120 days by VA-approved contractors.
What’s Covered by a VA Renovation Loan?
This is where people get tripped up. Just because it’s a renovation loan doesn’t mean it covers everything you might want to do. VA loan renovation costs are pretty clear-cut on what gets the green light.
- Roof repairs or replacement – If the house is leaking or missing shingles, you can fix it.
- HVAC systems – Broken or super outdated heating and cooling? You’re covered.
- Electrical and plumbing updates – Old wires or leaky pipes? Fixable.
- Foundation fixes – If the home needs structural help, you’re good to go.
- Flooring replacement – Torn-up carpet or busted tiles? Include it in your VA loan renovation costs.
- Energy efficiency upgrades – Think insulation, windows, and doors. The VA is cool with making homes more energy-friendly.
- Accessibility improvements – Widening doorways, installing ramps, or adding grab bars? Approved if needed for medical reasons.
The short version? Stuff that makes the home safe, sanitable, and structurally sound is fair game. Same thing the VA looks for in a normal VA appraisal.
What’s NOT Covered by VA Renovation Loans?
If it’s flashy, fancy, or mostly cosmetic, you might be out of luck. The VA isn’t into luxury, it’s into livability. Here’s what they usually say “nope” to:
- Swimming pools or hot tubs
- Outdoor kitchens or fire pits
- Decks and patios just for style
- Appliance upgrades unless necessary for livability
- Whole kitchen remodels just for a new look
- Luxury finishes (no marble countertops on this dime)
Now, that doesn’t mean you can’t do this stuff eventually. Just not with VA loan renovation costs. You’ll have to bankroll that part yourself or use another type of loan. Remember, the purpose of the VA loan is housing for veterans—not home flipping or upgrades for fun.
How Much Can You Borrow for Renovation?
The short answer? You can borrow the after-repair value of the home—not just the “as-is” value. So if the place is worth $180K now but will be worth $250K after repairs? That works.
Here’s how a simplified version looks:
Home Purchase Price | Repair Costs | After-Repair Appraised Value | Max VA Loan Amount |
|---|---|---|---|
| $180,000 | $40,000 | $250,000 | $250,000 |
So yes—you can buy a home AND fix it, bundled into one VA loan. But keep it reasonable. You can’t go all HGTV with it.
Real Talk: How Do Renovation Timelines Work?
This isn’t a free-for-all where you just get funds and start painting. VA rehab loans mean structure and rules. You’ve got to finish the renovations within 120 days of closing. So this is not for dragging your feet or second-guessing your paint color for three months.
Here’s how it usually plays out:
- You find the property and get a contractor’s bid ASAP.
- The VA-approved lender reviews and approves the scope of work.
- VA appraiser evaluates what the home will be worth after those changes.
- You close on the loan and renovations start fast.
- You finish in under 4 months.
Only Trusted Contractors Allowed
You can’t just call your cousin who does side gigs. The contractor has to be licensed, insured, and VA-approved. They need to put the scope of work in writing, agree to a payment schedule, and stick to it. If you’re in a market where contractor flakiness is high (looking at you, big cities), get everything signed and documented early. More on how this plays with the financial side of real estate? Check out our latest blog over at reAlpha’s blog page.
Don’t Sleep on This: You Still Need VA Appraisal Approval
Even with a renovation plan, the VA will send an appraiser to look at the current condition and future value. If the numbers don’t jive, your loan gets stuck. Make sure your contractor and lender know the VA’s Minimum Property Requirements (MPRs). Don’t assume they do.
Can You Do the Work Yourself?
Nope. Not with VA rehab loans. DIY heroes, step aside. The VA requires third-party, licensed pros to do the work. They want proof it was done right and will last beyond your Pinterest board.
Use Case Example for VA Loan Renovation Costs
Let me show you how real this is. Joe is a retired Army vet. He finds a fixer-upper in Ohio. Home’s worth $160K in its current state. It needs $50K in repairs—new flooring, HVAC, roof, electrical updates. After repairs, appraiser says it’ll be worth $230K. He gets a VA Renovation Loan for $210K (covers home + repairs). Total monthly payment stays lower than if he used a personal loan and mortgage separately. He moves in after 3 months with a fresh roof and working heat. Done. No delays or juggling multiple lenders. Want more practical funding tips like Joe’s story? We’re dropping new ones weekly over at the reAlpha blog.
FAQs About VA Loan Renovation Costs
Can I use a VA renovation loan for a rental property?
Nope. VA loans, including renovation ones, are only for primary residences that the veteran will live in.
What’s the max renovation amount covered?
There’s no fixed max, but you can’t go above the “after-repair value” of the home. Your lender, appraiser, and contractor will essentially set the ceiling based on their numbers.
Can I buy a house and get money to fix it up with one VA loan?
Yes. That’s exactly what VA loan renovation costs are all about—one loan for the purchase and repairs. One loan. One payment.
How long do I have to finish renovations?
You have 120 days from the date of closing.
Do I need a special VA lender for this?
Yep, not all VA lenders offer rehab loans. Look for one that specifically does VA Renovation Loans—and knows what they’re talking about.