01/20/2026
Effective January 20, 2026, Pennymac is aligning with Fannie Mae Selling Guide Announcement SEL-2025-10 regarding updates to the HomeStyle Renovation program. These updates include the following:
Increased Flexibility for Initial Renovation Disbursement
- Up to 50% of the total renovation costs at closing may be funded with an initial draw. A portion of this initial draw may be used to pay for permits, architect fees, and other eligible renovation-related costs.
Clarification for HomeStyle Renovation Limited Cash-Out Refinance Transactions
- HomeStyle Renovation limited cash-out refinance transactions may be used to buy out a co-owner’s interest, such as in cases of inheritance or divorce, while completing renovations.
- Borrowers may not receive any cash proceeds from these transactions, including those typically permitted under standard limited cash-out refinance eligibility requirements.
Fannie Mae will update DU to reflect these changes in a future release.
Additionally, Pennymac is making the following update to our HomeStyle Renovation product profile to allow for greater flexibility:
Update to HUD-Approved Consultant Requirements
- The threshold for requiring a HUD-approved consultant has been increased from $15,000 to $50,000.
- As a reminder, Pennymac requires the use of a HUD-approved consultant to assist with managing the project and draw requests when repairs or renovations exceed $50,000, or when any structural work is required.
Refer to the Pennymac Product Profile and the Fannie Mae Selling Guide for additional information and complete requirements.
Note: As a reminder, Fannie Mae HomeStyle Renovation is available for approved clients only.
Please contact your Sales Representative with any questions.