How to Finance a Home Improvement Project

Home improvement

Home improvement projects can be expensive. They can add value to a home or increase safety. Some people choose to do them on their own and others hire a professional. Before taking on a project, make sure you have an accurate estimate of what it will cost.

One option is to get a home equity loan. These loans are secured by the borrower’s home, and are generally more expensive than personal loans. You will need a FICO score of at least 680 to qualify for these loans.

Another way to get cash is to refinance your current mortgage. This allows you to tap your home’s equity to finance a renovation. The rate can be lower than the original mortgage.

If you are planning a major renovation, you may also want to consider a personal loan. A personal loan will allow you to borrow against the equity of your home. However, these loans usually carry higher interest rates than home improvement loans.

For a home improvement project to be successful, you need to start with a good estimate of how much money you will need. It’s also a good idea to compare rates and terms.

Many homeowners also plan to hire a contractor for all or part of their projects. While hiring a professional can be a good choice, it’s important to ensure the contractor is licensed and has a good track record.

Other options for financing your home improvements include a second mortgage or a personal loan. But before you apply for a loan, check your credit score, debt-to-income ratio, and whether the lender requires co-signers.