Uncommon Mortgage Loan Programs in Texas

Common vs Uncommon Mortgage Loans

Before we dive into the lesser-known programs, it helps to understand the difference between mainstream mortgage loans and uncommon mortgage loans.

At Mortgage Mark, we do a large volume of the following core programs:

• Conventional loans (Fannie Mae and Freddie Mac)
• FHA loans (including FHA 203(k) renovation loans)
• VA loans
• USDA loans (for home purchase)
• Jumbo loans
• Reverse mortgages
• Cash-out refinances
• HELOCs

These are the programs we are built to deliver with excellence. They cover the vast majority of home financing needs in Texas.

Now let us talk about the niche programs that we get asked about from time to time. Some of them are useful in certain cases. Others may sound good on paper but are rarely the best choice once you dig into the details.

Uncommon Mortgage Loan Programs Explained

Here is a breakdown of uncommon mortgage loan programs we are often asked about, whether we recommend them, and what alternatives may make more sense.

HUD Title 1 Property Improvement Loans

The HUD Title 1 Property Improvement Loan is a government-insured loan that can be used to finance non-luxury home improvements.

Examples of eligible improvements include:

• Accessibility upgrades
• Roof replacement or repair
• Foundation repairs
• Plumbing or electrical updates
• Heating and cooling system replacement

These loans are typically offered through local banks and specialized lenders. We do not process HUD Title 1 loans at Mortgage Mark because demand is very low and better alternatives often exist.

If you need this type of loan, we are happy to refer you to trusted community banks or lenders in Dallas or Texas that may handle them.

USDA Repair Loans and Grants

The USDA Section 504 Repair Loan and Grant Program provides funding to very low-income homeowners in rural areas who need to address health and safety hazards or make critical home repairs.

It is different from the regular Texas USDA loan we offer for home purchases. We do a large volume of USDA purchase loans across Texas, but we do not offer these USDA repair loans and grants as a standalone product.

If you believe you qualify for this program, we encourage you to contact your local USDA office or community organizations that work with USDA funding.

Energy Efficient Mortgages (EEM)

An Energy Efficient Mortgage (EEM) allows you to finance energy-related improvements such as:

• Solar panels
• High-efficiency HVAC systems
• Insulation upgrades
• Energy-efficient windows and doors

Technically, we can structure these types of loans. However, in most cases, we strongly advise against it.

Why? Because EEMs often get bundled with aggressive solar panel sales and financing pitches. We have seen too many homeowners get locked into long-term obligations that create problems down the road when trying to sell or refinance.

In fact, unless you are absolutely sure this is the right move and plan to stay in the home for the very long haul, an EEM is probably not your best option.

Safer alternatives include:

• HELOCs for flexible financing
• Cash-out refinances with a clear interest rate and repayment plan
• Personal loans that do not attach an additional lien to your home

If you are considering energy improvements, reach out to us first. We will give you an honest assessment and help you avoid pitfalls.

Reverse Mortgages Used for Renovations

We do offer reverse mortgages for eligible Texas homeowners age 62 and older. Many people ask about using reverse mortgage funds for home improvements.

While this is possible, it is important to understand that a reverse mortgage is not a renovation loan. You are accessing your home equity to fund improvements, which may or may not make sense depending on your goals.

If you are considering this strategy, we will walk you through the pros and cons carefully so you can make an informed choice.

Fannie Mae HomeStyle and Freddie Mac CHOICERenovation

These two mainstream renovation loan options are sometimes considered uncommon because not all lenders offer them.

We are very experienced in delivering:

• Fannie Mae HomeStyle Renovation loans
• Freddie Mac CHOICERenovation loans

Both allow you to roll the cost of repairs and upgrades into your primary mortgage, either when purchasing or refinancing.

Eligible improvements include:

• Structural repairs
• Kitchen and bath remodels
• Roof and window replacement
• Energy upgrades (if desired)
• Accessibility enhancements
• Outdoor improvements (with some restrictions)

If you are looking for a well-structured renovation loan in Dallas or Texas, these are excellent products that we can help you with from start to finish.

FHA 203(k) Renovation Loans

We also offer FHA 203(k) loans, another great mainstream renovation option that often flies under the radar.

There are two types:

• Limited 203(k) for repairs under $35,000 that do not involve structural work
• Standard 203(k) for larger projects that may include structural changes

If you are buying a fixer-upper or improving an older home, an FHA 203(k) loan can be a smart way to bundle the cost of improvements into your mortgage.

Alternatives to Uncommon Renovation Loans

In many cases, you do not need a niche mortgage loan to pay for renovations or home improvements. Here are three options we often recommend that are more flexible and easier to manage:

Home Equity Line of Credit (HELOC)

A HELOC is a revolving line of credit secured by your home equity. You can draw funds as needed for renovation projects and pay interest only on the amount you use.

Advantages:

• Flexibility for phased projects
• Lower upfront costs
• Interest-only payment option during draw period

Cash-Out Refinance

A cash-out refinance replaces your existing mortgage with a new one and gives you a lump sum of cash from your home equity.

Advantages:

• Fixed interest rate on new mortgage
• Access large sums for major projects
• Simpler structure than many renovation loans

Personal Loans

For smaller projects or when you do not want to touch your home equity, a personal loan can be a fast and effective solution.

Advantages:

• No lien on your home
• Fixed repayment schedule
• Quick funding

We can help you evaluate whether a HELOC, cash-out refinance, or personal loan is the best fit based on your financial goals.

Our Approach to Uncommon Loans at Mortgage Mark

At Mortgage Mark, we believe in doing what is right for our clients. That means being transparent about what we do and do not offer, and always helping you avoid common mistakes.

If you contact us asking about a:

• HUD Title 1 Property Improvement Loan
• USDA Repair Loan or Grant
• Energy Efficient Mortgage
• Other niche renovation product

We will give you honest guidance about whether it is the right fit and, if needed, refer you to trusted local banks or specialists.

If a Fannie Mae HomeStyle, Freddie Mac CHOICERenovation, or FHA 203(k) loan is a good solution, we will take great care of you through the entire process.

If a HELOC, cash-out refinance, or reverse mortgage is a better path, we will lay that out clearly so you can make the smartest decision.

Our goal is to help you finance your home improvements wisely and avoid getting locked into programs that sound good on paper but create problems later.

Talk to the Mortgage Mark Team Today

If you are exploring your renovation or home improvement financing options in Dallas, Texas, or anywhere in the state, reach out to us today.

Even if we do not handle a particular loan, we will:

• Answer your questions honestly
• Help you avoid common traps
• Refer you to trusted lenders if needed
• Suggest better alternatives where appropriate

We believe in doing what is right for our clients first and foremost. And we believe good karma leads to good business. Reach out to our team today to get started on your uncommon home loan. When you think mortgage, think Mark.