You love the house. You’re just tired of looking at the same dated kitchen every morning — and you’ve got a project in mind that would finally fix it.
So you do what everyone does. You check Zillow, look at your equity, and run the math on a home equity line of credit.
And it comes up short. By a LOT.
Here’s why. A regular HELOC is sized off what your home is worth right now — in its current, un-renovated state. That’s rarely enough to fund the project you actually want. And the other obvious option, a cash-out refinance, means giving up the first-mortgage rate you locked in and will probably never see again. Neither one is a deal you’d take.
So the renovation goes back in the folder. Someday.
But you’ve been doing the math against the wrong number.
Your Home Has Two Values — Most Lenders Only Count One
Every home you renovate actually has two values: what it’s worth today, and what it’ll be worth once the work is done.
A standard home equity line only counts the first one. It looks at the un-renovated house, sizes your line off that, and stops there. The value you’re about to create — the addition, the gutted kitchen, the finished basement, the ADU in the backyard — doesn’t count, because it doesn’t exist yet.
That’s not a budget problem. It’s a valuation problem. And it’s the exact problem NEO’s Renovation Loan was built to solve.
What Is NEO’s Renovation Loan?
NEO’s Renovation Loan is a home equity line of credit based on your home’s after-renovation value — what an appraiser determines your home will be worth once your project is complete.
You give the appraiser the scope of work. They find comparable homes with similar improvements and assign two values to your property on a single appraisal: the as-is value (today) and the after-renovation value (finished). Your line is built off that finished number.
For a lot of homeowners, that single shift is the difference between funding half a project and funding the whole thing.
And here’s the part that matters most in today’s market: it sits behind your existing mortgage, in second position. Which means…
You Keep the Low Rate You Locked In
If you’re sitting on a 3% or 4% first mortgage, you are not giving it up. Full stop.
NEO’s Renovation Loan goes into second lien position, behind your current mortgage. Your low-rate first loan stays exactly where it is. You’re not refinancing it, not touching it, not resetting your rate to whatever the market happens to be charging this week.
This is the whole reason the product makes sense right now. With first-mortgage rates where they are, nobody wants to trade a rate they’ll never see again just to remodel. You shouldn’t have to — and now you don’t. (We can also do this in first-lien position if you own the home free and clear, but for most homeowners, leaving the first mortgage untouched is the entire point.)
You Control the Money
Most renovation loans bury you in process. Inspectors. Draw schedules. A lender check that has to be approved before your contractor sees a dollar. Fees at every step.
This works differently. We do all the vetting up front — the project, the contractor, the scope, the values — before you close. Then, once you close, you get the checkbook.
- Pay your contractor directly. When they need a payment, they go to you, not to a lender’s draw department.
- No draw fees or inspection fees holding up the work or eating into your budget.
- No middleman deciding when your project is “far enough along” to release money.
- Interest-only payments during a 10-year draw period, so a big project doesn’t saddle you with a full payment out of the gate.
- The line stays open after the project’s done — pay it down, leave it in place, or use it for whatever comes next.
You manage the funds. You set the pace.
How Much You Can Borrow
The line can go up to 95% of your home’s after-renovation value. The tiers look like this:
- Up to $500,000 at up to 95% of after-renovation value — this covers the large majority of projects.
- Up to $750,000 at up to 65% combined loan-to-value on after-renovation value.
- Around $1,000,000 is possible by exception, with strong reserves, credit, and equity.
One guardrail worth understanding: there’s also a cap tied to your home’s as-is value, so you can’t buy a home with almost nothing down and immediately borrow against a massive future project. As long as you’ve got reasonable equity going in, the math tends to work — and we’ll run your specific numbers before you count on anything. That’s a five-minute conversation.
What You Can Renovate — and Who Qualifies
This is built for real projects on homes people actually live in. Think:
- Full gut remodels
- Additions and second-story builds
- Accessory dwelling units (ADUs)
- Pools, outdoor living, the whole vision
It’s available for owner-occupied homes and second homes, up to two units — and yes, you can add an ADU. (It’s not for investment properties.)
Qualifying is more straightforward than most people expect, and it doesn’t hinge on the version of your income that shows up on a tax return. The cleanest next step is a quick strategy call where we look at your home, your project, and your goals, and tell you exactly what your line could look like.
Already Mid-Project and Out of Money?
Here’s a scenario we see all the time. You started a renovation — maybe on a regular HELOC, maybe out of pocket — got halfway through, and the money ran out. The house is torn up. The contractor’s waiting. And now you’re stuck.
We can often step in there too. We can pay off an existing second lien and fund the rest of the project based on the after-renovation value, so you can finish what you started. A house being mid-construction isn’t a dealbreaker — it’s one of the most common reasons people call us about this product.
Renovate the Home You Already Have
Not everyone wants to pay top dollar for a turnkey home or get into a bidding war over someone else’s finishes. Sometimes the smartest move is the home you’re already in, in the neighborhood you already love — taken from dated to dialed-in.
The thing that’s always stopped that is financing: not enough equity today, and no appetite for trading away your low first-mortgage rate. NEO’s Renovation Loan removes both obstacles. You borrow on the finished value, and your first mortgage never moves.
If you’ve got a renovation you’ve been putting off because the math didn’t work, the math may have just changed. The difference is which value you’re borrowing against — and we build your line off the one that counts.
You don’t have to move to get
the home you really want.
Borrow on what your home will be worth once it’s finished — and keep the low first-mortgage rate you locked in. The renovation you’ve been putting off may finally pencil out.
When banks say no, NEO says YES
Renovation Loan FAQs
What is a renovation loan based on after-renovation value?
It’s a home equity line of credit sized off what your home will be worth once the project is finished — not what it’s worth today. An appraiser assigns both an as-is value and an after-renovation value on a single appraisal, and your line is built off the finished number.
Do I have to refinance my first mortgage?
No. NEO’s Renovation Loan sits in second position behind your existing mortgage, so your low first-mortgage rate stays exactly where it is. It can also be done in first-lien position if you own the home free and clear.
How much can I borrow?
Up to 95% of your home’s after-renovation value, with lines up to $500,000 — up to $750,000 at a lower loan-to-value, and around $1,000,000 by exception for strong files. We’ll run your exact numbers on a quick call.
How do the renovation funds get paid out?
You hold the checkbook and pay your contractor directly. There are no lender draw approvals, no inspections gating your money, and no draw or inspector fees. You make interest-only payments during a 10-year draw period.
Can I use it if I’m already mid-renovation?
Often, yes. If you started a project and ran out of money, we can pay off an existing second lien and fund the rest based on the after-renovation value so you can finish what you started — even with the house mid-construction.
What kinds of homes and projects qualify?
Owner-occupied homes and second homes, up to two units, including adding an ADU. It’s built for larger projects — additions, full gut remodels, ADUs, pools. It’s not available for investment properties.
