Do you feel an urge to upgrade your home to a more modern look or change a few things in it that don’t sit well with you?
If yes, then you need to consider some renovations. While you may not have funds set aside to carry out the renovation project, you can opt to get financing.
You may, however, be intimidated by high-interest rates that come with home renovation loans, but not to worry. Here are 4 tips to financing your home renovation for cheap:
1. Get A Home Equity Loan Or A HELOC
If you have equity in your house, you can use it to your advantage to get a loan to renovate your home. A home equity loan can be likened to a second mortgage.
If you have enough equity in your home that you can borrow against, you can use it to access funds to renovate your home.
You can also take advantage of the Home Equity Line Of Credit (HELOC). This financing option is similar in nature to how credit cards work. You can get continuous access to funds at your preferred time to perform the home renovations and the interest you pay will be based on the amount you’ve spent.
2. Get A Mortgage Loan For Home Renovation
You can also opt for a mortgage loan to help finance the renovation of your home. The beauty of these loans is that they have competitive interest rates which make the cost of borrowing funds pocket-friendly.
The mortgage loan interest rate is also tax-deductible, meaning that you can recover part of the interest payments you make every year when you pay your taxes.
3. Take Up A Personal Loan
You can opt to take up a personal loan to finance your home renovation. This loan is a term loan meaning that you’ll get a fixed interest rate and repay it on a monthly basis for the predefined period of time.
You can get this loan from your local bank, online lenders, or credit unions. How much money you get will be determined by your income and credit score.
4. Consider Using A Federal Loan Program
There are a number of federal loan programs you can take advantage of to finance your home renovation project.
If the renovation project costs less, typically below $25,000, you can consider taking up an FHA Title 1 Loan. You don’t need to have an income, credit score, or insurance from the federal government to get it. The loan term can last up to 20 years.
You can also take advantage of the FHA 203K Loan which can serve both as a financing option when buying a new home and also cater for the renovation costs that will be involved.
There is also the option of the Streamlined 203k loan program that can finance renovations costing up to $35,000.
These 4 tips will help you a great deal in financing your home renovation project. Once you choose the financing option that’s suitable for you, you’ll need to source the materials you need for the renovation work to begin.
These materials need to be high-quality. You’ll need to buy them from a trusted supplier at a pocket-friendly price.
For you in Australia, you can get these materials to kick start your home renovation project from renovatorstore.com.au.