There are many options out there for home improvement financing. Below we’ll go over a few factors you should consider when looking for the best way to finance home improvements.
Can You Do It Yourself?
If you are quite handy with tools, you can save a lot of money by doing most of the work yourself. The labor associated with home improvement projects accounts for the majority of the cost. With the cost of labor drastically reduced, you’ll be able to budget for more expensive, high-quality materials, which can last you much longer.
However, you must be realistic with your skill level. It can cost that much more to fix a problem than do to it right the first time.
The Size of Your Project
The size of your project can determine whether or not it’s worth it to get proper home loan financing or not. Break down the project into stages and determine an estimated cost for labor, materials, and a timeline. Ask yourself the following questions:
- What does your project consist of?
- Which area of your home are you looking to work on?
- What housing systems need to be worked on(plumbing, electrical, etc.)?
For large areas like the kitchen, bathroom, or any outdoor work, they can be relatively difficult projects that require a lot of labor and materials. In general, the smaller the area and the less amount of symptoms needed to work on, the easier the project. For those in-the-middle projects, like vinyl replacement window installation in Baltimore, MD, you’ll want to compare prices and quotes with multiple vendors for home repair financing.
Do You Have Equity?
Equity can help secure financing at a much lower rate when compared to home financing loans.
Home Equity Loans
Home equity loans are usually more ideal for people who’ve already paid a 20 percent down payment and have lived in their home for more than a few years. This is under the assumption that you’ve built a sizeable amount of equity over time. These offer a much lower rate when compared to home improvement financing from banks.
Home Equity Line of Credit (HELOCs)
HELOCs work similar to a credit card, but only for home improvement projects. The benefit of a HELOC is that it gives you a longer time in which you can borrow, with the average being 10 years. This allows lots of flexibility when it comes to when you’d like to start on your various projects. You can borrow as little or as much as you need to, and if you have multiple projects consisting of different timelines and variable costs, HELOCs give you the flexibility you need to account or all the associated variables.
Alternative Options for Home Improvement Financing
Your credit union is an excellent source for home improvement loans, especially if you already have established a long term relationship with them. They can be more flexible and more open to negotiation.
Depending on the type of project, there are government programs out there that can help pay for home improvement projects. If you’re planning on doing anything to improve the energy efficiency of your home like installing solar panels, look for mortgages or incentives that deal with energy efficiency. You can also Google Title I improvement loans to find out more.
It’s Important to Shop Around
You’ll want to compare every offer you get and find the most ideal offer for your situation. It might not always mean just a lower interest rate. It depends on what your priorities are and what benefits are important for you.
Take the First Step
If you’re looking for a quote for any home improvement projects, don’t hesitate to reach out and we can help you determine a proper estimate to bring with you to whichever home improvement financing options you’re currently exploring. Give us a call today at 410.237.8046!