If you’re interested in adding to the value of your home, you can do so with a home improvement loan. If you’re not familiar with a home improvement loan and what you can use it for, the following information can answer your questions.
A home improvement loan allows borrowers to improve or upgrade their property. While a home refinance loan and home equity line of credit can do the same thing, a home improvement loan has some similarities and differences. A home improvement loan is similar to a refinance loan and line of credit because all three require good financial standing and are usually secured using the liquidity in your home as capital. However, refinance loans and lines of credit are typically longer and usually involve larger amounts of money.
Home improvement loans are available in a wide range of amounts. Some can go for as low as $5,000, while others can go as high as $100,000. Depending on your credit score, interest rates can also vary on home improvement loans. Additionally, depending on contract terms, the payback timetable on a home improvement loan can range anywhere from a year to seven years.
Once you get the home improvement loan, you can use the money to pay for home renovations, home repairs, or additions. This can include anything from remodeling the kitchen to getting a new roof.
The process of getting a home improvement loan isn’t as difficult as you might think. Since home improvement loans are connected to a specific maintenance project or home upgrade, you can increase your chances of approval by explaining the actual project to the lender. You can also increase your chances of approval by having a good estimate of the costs of your project, and asking for that specific amount.
Sources: Chase, CNBC
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