4 Ways to Pay for Home Renovations

4 Ways to Pay for Home Renovations

Whether you are needing to carry out urgent home repairs, want to update your kitchen, or are looking to finally landscape your outdoor space, it can be tricky to find the money to pay for home renovations. 

Of course, in an ideal world, you would have a nice little nest egg just ready and waiting for you to dip into. Sadly, most American families aren’t that lucky.

Fortunately, just because you don’t have a rainy day savings fund, doesn’t mean that you can’t find a quick and responsible way to be able to afford improvements for your property. 

Keep reading to discover four ways that you can pay for your next home renovation project without putting your financial future at risk. 

 

1. Take out a loan 

One of the most popular ways for homeowners to fund a home repair or renovation is through a personal loan. Personal loans are usually unsecured, meaning that they are not connected to a piece of collateral, so a lender cannot repossess your home if you default on a payment. 

Some of the benefits of a personal loan include:

  • You can apply and be accepted online
  • Your home will not be put at risk
  • You can choose monthly repayments that you can afford
  • They are fixed term 

Make sure that you choose a reputable company and that you thoroughly read the loan agreement before you sign on the dotted line.

2. Use a credit card

Another popular option, deciding to use a credit card to pay for your planned home improvement will be dependent on how much money you need to borrow. As a general rule, you should only use a credit card to pay for smaller projects, so if you have a large renovation to carry out, such as an extension or new conservatory, this is not the best choice for you. 

Some of the benefits of using a credit card include:

  • You can get the money fast
  • You can earn cash back or other rewards 
  • You can find 0% interest credit cards

Always check the terms and conditions of your credit card before spending and make sure you pay back your debt on time to avoid costly high-interest fees and late payment charges. 

3. Borrow from family 

If you have this option, it can be a great way to avoid high-interest fees. That being said, borrowing money from family and friends is not without its challenges. You need to make sure that both parties are happy with the terms and conditions of the arrangement and that neither one uses the personal connection to take advantage of the other. 

Benefits of borrowing from family include:

  • You can get the money fast
  • You may not have to pay any interest 
  • You may be able to borrow more if needed 
  • Less urgency to pay back the loan 

4. Remortgage your property 

If you need to borrow a large amount of money for your home renovation project, then this could be the way to go. Remortgaging allows you to release equity in your home, often with a low-interest rate and borrow more than enough money to complete any home improvements you may want to carry out.

Benefits of remortgaging include:

  • Strong chance of a good interest rate 
  • Possibility of consolidation 
  • You can borrow more money 

However, this option will stretch your mortgage to a longer time frame, and the process itself can be quite lengthy to complete.

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