Adding an extra room in your loft or just carrying out routine maintenance on an aging property is expensive and will need financing; the easiest way to refresh a tired looking house is to arrange a home improvement loan. 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.
A home improvement loan is a borrowing option that is open to most homeowners and there's a choice for you to take a secured loan or a loan with no equity required. 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.
However, one stipulation for a zero equity finance arrangement is that the combined income of the owners reaches a specified limit but it must not be greater than the limit imposed by the county where they live. Certain facts are researched by the lenders; like the type of property and reasons for the loan but essentially, this type of loan is easy to arrange with only a small amount of documentation to complete.
The difference with a secured home improvement loan means the value of the property is taken into account so when there is spare equity, the loan is basically taken out of this. This type of loan is much quicker to organize and because the house is being used to secure the loan, it benefits from better terms and lower interest rates.
The lender will only provide funds for a secured loan based on the current equity available in your property. 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.
When you arrange a loan this way, the lender has a claim on your home should you fail to meet payments, so only borrow judiciously and consider your ability to pay it back. When money from a home improvement loan becomes available, there's a temptation to use it in other less essential areas but this can be a big mistake so remember why you decided to borrow in the first place.
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James Redder facilitates a Home Refinance Rate website. If you liked the Financial info, GET the powerful info RIGHT NOW. Goto Loan Refinance website.
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