If you are looking to increase the value of your home then remodeling is the method, but you will need to finance it first; one option is to apply for a home improvement loan to finance the project. Very few people want to attempt many of these home improvements themselves so tradesmen such as electricians, plumbers and carpenters will need to be employed.
Bear in mind that home improvement loans are just for that and as such two options are available; secured loans and those that do not require equity. When a homeowner has only just purchase the home, they are still able to arrange a loan, subject to their status of course. Finance organized to improve a home is normally arranged to run for up to fifteen years when equity is not required.
The primary stipulation when applying for a loan without equity is the combined income of both owners but the amount of the loan must not be higher than the amount allowed by the county law where the home is situated. The loan process for people applying for a no equity loan is minimal even though the property and type of improvements planned are looked into.
When arranging a home improvement loan that’s secured, it means that any residual value your home is used to help fund the loan. The upside to this type of secured loan is it’s available at more favorable rates of interest but is not arranged as a second mortgage on the property.
Obviously the amount you are able to borrow using a secured loan will depend on the value of your home. The lender will work with you in determining the value of your home based on its current value, amount of outstanding mortgage, and other debts that you currently have.
All these factors will be considered for putting a loan package together for your consideration. Although it is not set in stone, the amount they are prepared to lend will be based on a percentage of the property valuation but some lenders will actually lend as much as a quarter again as the property is worth.
Over extending your ability to pay is the quickest way for a person to lose their home when they cannot keep up the repayments. So when you arrange a home improvement loan, it is best to use it only for necessary repairs and make renovations or home additions only when you have the money to spare.