There are various reasons to renovate your home: to save energy/save on utility bills, to make room for your growing family, to increase the resale value of your home, or simply to just bring a fresh new look to your home! There are also a number of different ways to finance these renovations.
There is a personal loan, where you pay regular payments of principal and interest for a set period, typically 1-5 years. You also have the option of a fixed/variable interest rate for the term of the loan. The interest rate on a personal loan is usually less than that of a credit card.
There are personal lines of credit, another popular choice for financing renovations that is ideal for ongoing or long-term renovations since it lets you access your funds at any time and also provides a monthly statement in order to help you track your expenses. These usually offer lower interest rates than credit cards, and charges interest only on funds used each month.
You may also choose secured lines of credit or home equity loans. These options offer all the advantages of regular lines of credit/loans, but are secured by your home’s equity. They can be very economical, as they offer preferred interest rates, but initial set-up costs including legal and appraisal fees apply. Lines of credit and home equity loans are usually limited to approximately 80% of your home’s value.
Mortgage refinancing may be the superior option. When funding major renovations, refinancing your mortgage allows you to spread repayments over a long period at mortgage interest rates, which are usually much lower than credit card or personal loan rates! This type of financing can allow you to borrow up to 80% of your home’s value.
Your Burbank mortgage lender. Contact me today to learn more about the benefits of home renovation loans!
Some Examples of Home Renovation Loans Well Spent:
Home improvement projects are a great way to not only improve your living space but to add value to your property. Freeing up the money for such endeavors can be challenging but home renovation loans are the perfect way to make the investment without having to break the bank. Whether you’re looking to fix up a bathroom or add a complete addition, there is a loan out there perfectly designed to help you meet your goals.