Secure a Home Improvement Loan the Easy Way

| November 10, 2014 | 0 Comments

Chances are that at some point, you’ll find yourself wanting or needing to make home improvements. But big projects can cost a lot of money. And not everyone has the funds saved up to undertake a kitchen renovation or something of a similar scale. If you’re planning some home improvements, you may be able to get a loan to help you out. Home improvement loans are secured on the equity you have accumulated on your home. Usually, they’re for a set period, often five or ten years. If you want a home improvement loan, you’ll need to get everything in order and have everything organized.

Plan Your Project

You’ll need to have an estimate of the cost of your home improvement project. So you can start by planning out your project to allow you to come up with a rough budget. Get estimates from different contractors to make sure you’re not going to be over or underestimating the cost of your project. Don’t forget that unexpected costs could crop up – in fact they’re likely to. Add an extra 10% to your budget to allow for these extra costs. You should also take into account whether you’ll be able to pay for any of the project with cash. Doing so will lower the amount you need to borrow and increase your chance of approval for a loan.

Home Loan Easy Way

Check Out Your Credit Report

Your credit report is very important when you’re looking to take out a loan. Having a look at your report before applying for a loan gives you the chance to take note of any discrepancies and fix anything that you can change. In the States, you can get one free credit report a year through annualcreditreport.com. You can also pay to access extra reports through credit bureaus or third party businesses. When you have your report, look for anything that looks incorrect or fraudulent and try to resolve the issues with the credit company.

Be Prepared

Whether you’re completely renovating a 3 bedroom town house in Northallerton or you just need to fix your roof, you need to have everything in order. Before applying for your loan, gather any important documents and information that will help to show your financial status. You need to have proof of employment (or a record of accounts if you’re self-employed) and any tax-related documents for the last several years. As with your credit report, check for any inaccuracies and resolve them.

Apply For Loans

When it’s time to apply for a loan, don’t just approach one lender. It’s important that you approach several lenders to make sure you get the best loan rate. Having your information in order, including a plan of your intended improvements, will increase the chances of the lender looking on you favorably. Look at banks and other lenders to find a loan that’s suitable for you. If the equity on your home is limited, you can try to get an FHA Title I Loan.

 

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Category: Home Loan

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