Remodeling the bathroom is one of the best ways to improve your home’s value. Finding the funds to pay for the remodel might be a challenge. Luckily, there are plenty of financial options available today to make that dream bathroom a possibility. You can take out a number of different loans for this project, depending on your budget, goals and credit history.
Loans and Your Credit History
You’ve decided to install a Kohler LuxStone shower, but paying for this upgrade has you turning to loans. It makes sense to borrow money to ultimately make more money from your investment in the home. Before you apply for any type of loan, look at your credit history.
Clear up any mistakes or old data from the history. When you apply for a loan, banks will pull this information. You want a clear history so that you gain a low interest rate.
Home Equity
Obtaining a home-equity loan on your New Orleans property is a common choice for bathroom remodeling. You can take out several thousand dollars based on the home’s value. The bank will determine this amount. It’s funded in a bulk amount so that you can pay for everything upfront.
HELOC
A HELOC stands for home equity line of credit. It’s distinctly different than an outright loan. HELOCs work more like a credit card to finance that Kohler LuxStone shower. Your bank gives you a line of credit based on the loan-to-value ratio of the Baton Rouge property, reports This Old House. Borrow up to the maximum credit line for about 10 years. You pay back the loan at that point over several decades.
Personal Loans
Your Baton Rouge bathroom remodel may be a major endeavor, but your equity is lacking right now. Contacting your bank about personal loans is an option. Ask about any loans that are specific to home improvement. These loans will still fall under the “personal” category, but the bank may have some attractive options with low interest rates.
Avoid personal loans that have questionable rates, such as adjustable types. The interest might surprise you with expensive bills later on.
Government Options
Bank Rate mentions government loans that may apply to your situation. HUD and veteran departments, for example, might have loans for a remodel at your New Orleans home. These loans are specific to certain situations, so you’ll need to perform some research.
Many of these loans are offered as low or no interest types. Call a few departments to see if you qualify for any funds. The pay off is low-cost funds to improve your home’s value.
Refinancing
If you’ve held a home loan for many years, it might be time to refinance. In essence, you roll the mortgage balance into a new loan with a lower interest rate. At the same time, you pull a certain amount of money from the equity so that you can pay for the bathroom remodel.
Any costs are minimal because they’re built into the refinanced loan. You can start with the remodel as soon as the loan is funded.
Be realistic about the remodel when it comes to the surrounding neighborhood. Don’t overimprove a bathroom in a low-price neighborhood, for example. Match the upgrades to the area so that you recoup the costs and pay back the loan in little time .