The Benefits of Home Improvement Loans
Our home can be our castle, and as such we want it to look the best it can. However, depending on what you are doing, the financial restrictions can often mean that some improvements have to be put on hold until the budget becomes available. However, if some renovations simply can not wait, then it could be worth considering a home improvement loan. However, there are a number of factors to consider before making a commitment.
How Much Do You Need to Borrow?
Before making an application, it can be advisable to ascertain as to how much you will need to borrow. This means looking at what work needs carrying out, and assessing a series of quotes. Once you have an estimate of how much is needed, you can then make a well-informed decision in relation to how much money you need. This will also allow you to keep the monthly repayments as low as possible.
Check Your Credit Report
Regardless of how unblemished your credit file is, it is always worth checking your current credit score. This will ensure that there are no errors present that can affect your application, as well as allowing you to recognise what interest rates are available for your particular credit score. While it can be tempting to stay with a provider we have used all our lives, knowing what offers are available can save us a great deal of money moving forwards, and in some instances, help us gain a better deal with a provider that's been used before.
Consider Your Circumstances
While there are some of us that currently live in the property we want to carry out improvements on, some of us may be wanting repairs and improvements made before moving in. As such, you should look to give yourself enough time for the loan to be processed, allowing you to carry out renovations within the right time frame. This means that you do not have to move into the property, and then have the burden of carrying out the home improvements. Trying to get them completed beforehand means that whole process can be less stressful.
Catering for Change
Sometimes family life can bring on a series of changes. It could be that elderly relatives have moved in with us, or there has been a new addition to the family. In either event, it is inevitable that more space could be needed within the home. Selling your home and moving on may not be an option, but having an extension built, or a loft converted can open up a slew of new space. As such, many families will need access to funds in order to carry out the renovations in the quickest time possible, while ensuring they are completed to a professional standard.
Added Value To Your Home
While it is not always the case, in some instances and depending on what work you are having carried out in renovating the property, there could be some added-value to your home. So although there is the interest to consider when taking out a loan, you may find that you actually increase the value of your currently property as a result of the improvements made.
Other Benefits of These Types Of Loans
As well as the possible financial benefits a home improvement loan can bring, there can also be a number of other factors. When we have lived in certain property for a number of years, it is important that we are able to inject new life into our homes where possible. Having access to funds means that you can make aesthetic changes that benefit the look of a property.
Having access to capital sooner rather than later also means that if any important repairs need to be carried out, they can be done so sooner rather than later. This ensures that no further damage occurs to the property than if it was left. This also ensure that homeowners save a lot more money as a result.
Considering Your Budget
While it can be tempting to try and fix everything straight away, you need to ensure that you are able to keep up with the loan repayments that will follow. If you are not able to ascertain that you can meet the demands of borrowing a larger amount, then it could be worth revaluating the work that needs doing, and see if there is anything that can wait until funds become available.
If there is a lot of work that need to be carried out, then it can be worth doing some research as to what options are available to you in getting the work done at the lowest cost possible. If you are able to carry out some of the work yourself, then this can save you a considerable amount of money. You can also compare prices and quotes from a plethora of different providers. However, it is important that you are able to ensure that the services employed are of good repute.
Some loans may rely in the equity the homeowner has within their property, which is normally a portion of the home that has already been paid for. This again can affect as to how much is available when it comes to a loan. In this regard, it can be advisable to double check as to where your mortgage payments are up to so you are able to gain an idea of how much will be available to you.
What Interest Am I Likely to Pay?
Each loan is offered on a person's circumstances, so while many will receive the same rates in relation to their new loan, there are instances where people may pay less or more, depending on a number of factors. For example, those with an unblemished credit file will be more than likely be given access to better rates than those who may have some deferred payments, but again, a number of factors can come into play. This is why it is important to check that all-important credit report, as it will allow you to estimate how much interest you are likely to pay.
A Lender Has Rejected Me, Are There Other Options?
Again, this can depend on the criteria used for assessing your loan application, but just because one lender has turned you down, does not mean another will do the same. However, applying for numerous loans can have a greater impact on our credit file, so it is important that we are realistic when applying for certain loans.
If we do have to pay a little more interest, it is something we may need to embrace, so it is not all bad news. Keeping up the repayments on a financial commitment means that you are also strengthen your credit history, meaning that although the best interest rates are not available now, they may well be in the future.
Make Use of the Online Tools Provided by Lenders
Before the birth of the Internet, we often had to visit a bank personally to get an idea of how much our loan repayments would be over a set period of time. However, the breakneck speed that technology currently evolves at means that lenders who provide loans are able to offer a number of online tools to help give customers an idea of how much repayments will be, and how long these will occur for.
As such, those looking to apply for a home improvement loan can visit the website of the prospective lender, and see if there Is an online calculator available. They will then be able to look at different terms and loan amounts to find a solution that suits their requirements.
Everyone's requirements can be different, but the overall method used in sourcing a loan should remain the same. While it may seem easier to sign on the dotted line for the first loan you are offered, you may find that you end up paying more as a result.
Taking the time out to consider what options are available, and which is the most cost effective of these can put you in a better financial standing moving forward. You also need to ensure you are fully aware of how much is available to you, as making plans before ascertaining can mean a lot of time can be invested into something that may not be viable.
You also need to remember that in some instances, you may be borrowing money against the equity in your property. In this regard, it is important that you are able to ensure that all payments in relation to the loan can be met, otherwise there could be ramifications moving forward.
However, there is no denying how beneficial home improvement loans can be, especially if we have a series of work that needs to be carried out sooner rather than later. We just need to ensure that the company we use for a loan is one of good repute, that is able to confirm any terms and conditions, as well as answer any questions you may have in relation to the loan.
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Just some of the UK Lenders we compare
UNSECURED LOAN REPRESENTATIVE EXAMPLE - 49.9% APRC (variable) Secured loans from 3.83% APRC.
SECURED LOAN REPRESENTATIVE EXAMPLE - Assumed borrowing of £30,000 over 240 months, with a 36 month fixed rate followed by a variable rate plus a brokers fee of £1,495 and a lender fee of £495 would result in a monthly repayment of £256.04, the APRC 8.2% for 36 months then a monthly repayment of £247.45 on variable rate, the total amount payable would be £59,817.24. The actual rate available will depend on your circumstances, please ask for a personalised illustration.
By taking out a secured loan you are borrowing money that is secured against your home. If you are thinking of consolidating existing borrowing you should be aware that you may be extending the terms of the debt and increasing the total amount you repay. Rates as of 16/01/2017.
THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
WARNING: LATE REPAYMENT CAN CAUSE YOU SERIOUS MONEY PROBLEMS. FOR HELP, GO TO MONEYADVICESERVICE.CO.UK.