If you’re ready to add more value to your home and update the look of it to fit your tastes, consider all the opportunities a home improvement loan will offer you.
A home improvement loan can offer you the freedom to remodel your home to fit your family’s taste and lifestyle.
With a home a improvement loan, you can make updates to your home that offer you both personal and financial value.
Home improvement loans are great opportunities for homeowners with specific plans on the renovations they want their home to undergo, but don’t have available savings to pay for them upfront. Home improvement loans are frequently seen as an investment toward raising the value of your home, which will pay off down the road.
What is a Home Improvement Loan?
A home improvement loan is a relatively short-term loan (most home improvement loans are only for 5–10 year terms) that are for a specific amount and a defined home improvement project. Traditionally, the equity in your home is used as collateral for the loan, but you can typically find the flexibility you need to qualify for the a home improvement loan.
Benefits of a Home Improvement Loan
Low & Fixed Interest Rates Available
Home improvement loans offer a great advantage over putting the expenses on your credit card. You can access a lower rate that’s fixed for a set amount of time. Not only will that help with saving money in your budget, but with a fixed-rate loan, you’ll know how much to budget for each month to cover the monthly loan payments.
Raise the Value of Your Home
Whether you plan to sell your home shortly after renovations are complete, or simply enjoy your remodeled home, a home loan improvement loan offers the solutions you need to raise the value of your home. Updated kitchens and bathrooms are proven to offer a significant bump in the value of your home, and resonate with home seekers. Take advantage of accessing finances that will allow you to sell your home faster and for a higher price. Home improvement loans are investment decision for your home.
Home Improvement Loans Can Take Care of All Remodeling Projects
Because home improvement loans require planning out what kind of improvements you want to make to your home ahead of time, between getting an estimate from a contractor, and receiving approval from a lender, there’s a lot of trust established in the transaction. If you qualify for a home improvement loan, you can have confidence to accomplish of all the remodeling updates with your loan. No more worries about having a never-ending remodeling project due to funds fluctuating in availability. With a home improvement loan, you receive the cash in a lump sum to cover all the plans you’ve laid out to your lender.
Home Improvement Loan FAQs
Are home improvement loans secured or unsecured?
Home improvement loans are available from various lenders as both secured and unsecured loans. Secured loans mean that the equity in another asset (home, car, etc.) are signed off as collateral to the home improvement loan. Unsecured loans do not have collateral tied to them. Secured loans will be available at a significantly lower interest rate because the lender has more trust in the borrower.
What’s the best use of a home improvement loan?
While there may be many great options of what to improve first in your home, consider prioritizing any necessary improvements to the structure or foundation of the house to extend the longevity of the home. If those are already taken care of, making your home more energy-efficient with new windows or appliances is another great option. When it comes to cosmetic changes, remodeled bathrooms and kitchens typically attract the most bang-for-your-bunk when it comes to resale value.
How do I know a home improvement loan is right for me?
If your home is in desperate need of repair, you’ve outgrown it, or your needs have changed, a home improvement loan is a great solution. Remodeling pieces of your home or adding on an addition will likely cost less than buying a new home, and your home will be market-ready for when the day comes to sell.
How do I know when to take out a home improvement loan?
If your financial situation is prepared to take on a new loan, the best time to take out a home improvement loan is when interest rates are low. Interest rates for home improvement loans are tied to the federal reserve rates—similar to mortgage rates—so pay attention to the interest rates for mortgages.
Have a question or want to talk with a lender?