Easy ways to find financing for home renovation

The burning question in the minds of many Australian owners is: "will I renew" or "relocate"? Therefore, if you are one of these owners, you may also have realized that the high cost of buying a new home and selling your current home far exceeds the challenges of renovating your current home. However, you should only renew if the renovations:

>> Add value to your home

>> It results in a better standard of living

>> It will be used to perform emergency repairs or complete extensions of the home

Do lenders / credit providers impose restrictions on the type of renewals?

Subject to their credit policies and loan guidelines, most lenders / credit providers will allow you to borrow funds to improve the value of your home for any worthwhile purpose, as if you need:

>> Add another room or any other room

>> Renew / update your bathroom or kitchen

>> Add a pergola and an outdoor recreation area

>> Install a pool

>> Extend your garage from a single garage to a double garage

>> Build a secondary home on your existing property

>> Any other structural or non-structural construction

What financing methods can I choose?

Here are some examples of popular methods to ensure easy home renovation:

Loan on the accumulated value of housing: this financing agreement is perhaps the most common way for Australians to finance their home renovation projects. A home equity loan works where you borrow money against the value of your home. To illustrate this, I have provided the following example: General Contractor 

>> The example assumes that your home is worth $ 700,000 and

>> Your mortgage loan is $ 300,000

According to the example illustrated above, you will have $ 400,000 of capital in your home, which you can use to finance your renovation project.

The recent increase in domestic prices has resulted in many Australian owners having acquired considerable equity in their property, which can facilitate obtaining a home renovation loan for these people and reduces their need to dig into their own reserves of cash.

Personal loan: This financing agreement is an appropriate option for you to consider if:

>> You have no equity available in your home, or

>> You just have to complete some minor renovations

When choosing a short-term personal loan, you will find that:

1. The personal loan interest rate is much higher than a home equity loan, and

2. It may be limited to the amount you can borrow (for example, from $ 5,000 to $ 50,000)

Construction loan: This financing agreement is available for you to complete large-scale renovation projects that require the approval of the advice and services of a licensed builder. The lender / credit provider will impose the following restrictions when considering a construction loan for home renovation:

>> The lender / credit provider will not finance the total loan amount in advance

>> The lender / credit provider will give you the money only in stages as the renewal progresses

Can I afford to rebuild my house if it was destroyed?

You must already have normal housing and construction insurance, but you must increase your construction insurance to cover the costs associated with your home renovation project. Therefore, if you cannot afford to rebuild your home if it was destroyed by fire damage or any other natural disaster, the following questions should be asked:

>> Do you have construction insurance?

>> If you have construction insurance:

1. Is the amount of insurance coverage adequate?

2. What does your construction insurance plan cover?

3. Does your insurance plan include full replacement coverage or Insured Sum coverage?

Do not delay and take action immediately

Therefore, if you are thinking of renovating your home without any stress, you should seek the advice of a professionally qualified and experienced home finance broker who is a specialist in home renovation loans and who has helped numerous homeowners when they considered renewing their property.

He / she can organize the financing of your renovation project. A loan broker will provide you with a wide range of options and financial products after creating a budget for you. But remember to be clear about your future plans, as it will help you choose the right financial option.

Now that you have read this article, I sincerely hope it helps you understand the easy ways to renovate your home with