With summer approaching, many homeowners have remodeling projects on the brain, and that includes the financial side of making improvements to your home. If you’re in the process of planning a major project, you may have realized you’ll need some extra cash to make it happen.
Luckily, there are many financing options available, you just need to research which is the right fit. Here are three of the most common types of home improvement loans to help get you started:
- Home Equity Loans and Lines of Credit: Both of these options are well-suited for larger remodeling projects and allow you to use your home as collateral. For many, a home is the largest asset and a home equity loan will aid you in getting the most money for your remodel, giving you access to the money you need up front. A Home Equity Line of Credit (HELOC) on the other hand, gains you approval for a total loan amount and you withdraw money as you need it.
- Home Improvement Loans: These short-term loans are great for small remodeling projects that will ultimately improve the livability of your home, including practical improvements like a new roof, or an air conditioning system. Unlike other financing options, you don’t need to have equity in your home to qualify and interest rates on these loans are often lower than rates for standard unsecured loans.
- Grants and Specialty Loans: For homeowners thinking outside the box, grants and specialty loans are great financing options to look into, especially for any energy-efficient home improvement projects like installing solar panels. Grants provide viable financing options to low-income individuals who may be unsure if they qualify for a standard loan and, if eligible, may not need to be paid back to the nonprofits or city or state government organizations that disperse them.
When it comes to your next home improvement project, there are a myriad of financing options available to you.