Maintaining the value and integrity of your house with home improvement jobs is an important part of homeownership. Unfortunately, many of these jobs can be very expensive and this can be daunting to homeowners.  If you are uncertain how you can afford a home improvement job such as a new roof installation or siding maintenance or repair, you may be surprised to learn that you have many options at your disposal.

At the website LifeHacker, Melanie Pinola gives advice in her article, What’s the Best Way to Finance My Home Improvement Projects? In this article, she explains the various ways you can opt to pay for the projects you have in mind for your house. These include:

  • Paying with Cash: This is always the most financially savvy option. If you are able to save up for your job in advance, or if you have the funds available to you without taking out a loan, you can avoid hefty interest rates by paying in cash.  Of course, this isn’t always an option, particularly with larger, more-expensive jobs or jobs that must be done right away. Fortunately, there are several financing options available to you as well.
  • Using a 0% or Low Interest Credit Card: This is a good idea for smaller projects that you will be able to easily pay off before the introductory low interest rate expires. This can enable you to finance your job virtually interest free, but if you cannot pay it off before the introductory rate expires, you may face very high interest charges, this is best kept for projects under $15,000.
  • Using a Personal or Unsecured Loan: This is a good idea for medium-sized projects that may take a bit longer to pay off. While the interest rates are higher than they would be for a home equity loan, the loans offer easy approvals and do not require you to put up collateral, which may be risky if there is a chance that you might default.
  • Using Cash Obtained by Refinancing Your Mortgage: Refinancing your mortgage while interest rates are still low may be a good idea. If you choose to do this, you can opt to take out a mortgage loan that is greater than the amount you currently owe on your house and get this money back in the form of cash at closing. You can then use these funds to pay for your home improvement job.
  • Using a Home Equity Loan: These loans are the best bet for larger projects as you have a longer amount of time to pay them off and you can get them at much lower interest rates than through other loan options, and these rates are typically fixed so you have a set monthly payment until the loan is paid off. You will need to have built enough equity in your home in order to qualify for this type of loan.
  • Using a Home Equity Line of Credit:  These enable to you borrow only as much as you need for your project, which you can take out in installments during a designated draw period. You will then have a specified amount of time to pay the money back. Unlike the home equity loan, interest rates on a line of credit can vary, so if you take it out while rates or low, you may be paying a higher rate by the time you are paying it off.

You can learn much more about each of these financing options, including their pros and cons, by reading the full article here.

Baltic Home Improvements offers Chicagoland homeowners a variety of options when it comes to paying for your home improvement job. You can use any of the method listed above, or, if you prefer, you can go through our financing. Through our relationship with EnerBank USA, we can provide you with an easy way to get a 12-month same-as-cash loan or a 5-year unsecured, fixed-rate loan.  We also accept all major credit cards. Contact us today to learn more about your financing options.

Image source: Mark Moz