What are the Best Ways to Finance Your Home Improvement Projects?

16 Aug

What are the Best Ways to Finance Your Home Improvement Projects?

This is paid guest post submission from Ethan Rockford.

If you own your own property, there’s a good chance that there are a few DIY or home improvement projects on your mind that you’d like to tackle as quickly as possible. After all, home improvement projects can be a great way to make your property a lot more appealing to yourself, your family, and even future buyers. With the right projects, you could even make your home more cost-effective, by reducing your energy and utility bills, and limiting your risk of having to pay for expensive repairs in the long run.

Of course, the unfortunate truth about home improvement solutions, is that whether you choose to do them by yourself, or you make the decision to hire out and get the help of a professional, you’re always going to be paying a pretty penny for whatever you want to get done. If you can’t afford to wait decades to enjoy a nicer home, or you need to think about your projects right now, there are some ways that you can get the financing you need.

Remember to Use Cash Whenever Possible

At the end of the day, using cash to pay for your home improvement projects will always be the best option for those who want to save money. After all, it means that you won’t end up accumulating a lot of debt when you want to enjoy a new bathroom, or seal up your windows and doors. However, the truth is that most of us simply can’t afford to make home improvements out of pocket.

The average big renovation can cost thousands of pounds. Depending on how much you want to do, you can feel like you’re making your mortgage deposit all over again. However, even if you can only save a little bit of cash, and pay for the rest of the expense through a financing option, this might be the best way to go about making the most out of your property.

Try a 0% Credit Card

If you have a good credit rating, then there’s a good chance that you’ll be able to use your credit card to make a few small purchases – depending on how big your home improvement projects might be. Remember, that you’ll need to have a reasonably good idea of your credit rating before you start applying. As if you are rejected for a number of personal loans at once, this could leave a black mark on your record, and mean that you struggle to get financing in the future.

Hands cutting a credit card with scissors

Take the time to shop around for the best credit card offer available, and remember that you can really only use this solution for small home improvement projects. It’s also worth noting that you should take the time to make sure that you know the terms and conditions of the credit card offers you’re considering before you sign up for anything.

Use a Personal Unsecured Loan

If you need more financial support than the standard credit card can offer, then you might need to start thinking about the benefits of a personal, unsecured loan. For those projects that cost a little more, personal loans are a great solution, as they don’t require any collateral, and they’re easy to be accepted for. Because they’re not secure against any of your personal property, your home isn’t at risk if you end up defaulting.

The only problem is that interest rates can be a little higher if you don’t know what you’re looking for. It’s important to make sure that if you’re considering using a personal loan to fund your home improvements, you take plenty of time to compare and contrast the different options available on the market today, and what you might be able to do to reduce some of your expenses.

It’s also important to remember that the terms and conditions on personal loans can vary drastically. So you’ll need to make sure you know exactly what you’re signing up for. Stay away from any loan offers that seem suspicious or too good to be true, and speak to a personal financial advisor if you need some extra help.

Using Home Equity Loans

Another type of loan that you can consider if you’re thinking about improving your home with some financial assistance, is a home equity loans. Home equity loans work a lot like getting a second mortgage on your home. Usually, you get a fix interest rate for the life of your loan, and your money will be give to you in a single sum. Although the terms of these loans can vary, most home equity loans will need to be paid back within fifteen years.

A home equity loan can sometimes be quite pricey. However, with closing costs and transaction fees similar to a standard mortgage – so be wary.