Home improvement is a term that can include any home renovation project that affects your house’s aesthetics, safety, and/or function. Examples of home improvements include repairing, remodeling, altering, adding on, and landscaping.
Before starting a project, it’s important to create a budget. Renovations can be costly, and a well-planned budget will keep them within your desired budget.
A home improvement loan is a financial option for homeowners who want to make repairs or remodel their homes. Homeowners can borrow up to 85% of their homes’ value, and the loan is secured by the property. The repayment is typically a fixed monthly payment, and is repaid over five to 30 years.
Home equity loans are another financing option for home improvement. These loans require homeowners to have at least 20% of their homes’ value in equity. It’s often more expensive than a personal loan, but can be a better option for long-term projects.
In addition, a home equity line of credit may be a viable alternative for those with good or excellent credit. However, these loans can also be more time-consuming and complex. You can choose to make payments on a loan over a period of up to 30 years, and you have to pay closing costs and origination fees.
Whether you’re making a minor or major renovation, you need to consider the impact on your resale value. If your project is a cosmetic one, it might not add much to your home’s resale value.