Improving Your Home With The Aid Of Loans!!

We had a young couple named Jon and Lucy moves into the house next door this past year. This house had been on the market for a number of years and it definitely needed a little bit of work. The last family had lost it to foreclosure during the housing crisis, and nobody had been taking care of it for at least a couple years. Naturally it needed a home improvement project and when Jon came to me for advice on the matter I admit I was a bit baffled. I began researching how young couples can find home improvement loans with no equity. Here is what I found.

Home improvement loans can often be found through the FHA with many programs for various income levels available. There are certain guidelines that need to be met however and it usually requires some sort of credit check.

• Home improvement lenders offer loans for all scales of home improvement projects. It could be a loan to remove old, ragged carpets, or loans to make major additions like new rooms or an updated septic system.
•  The smart borrower will have a specific goal in mind that will both update the house and make it more valuable. Good examples are homeowners who make "green" additions to their homes. These can often provide major tax breaks and save on utility bills.
• Home improvement financing for contractors can often be very expensive. Speak with your home owner's insurance company about available contractors in your area and find out the specific costs associated with your project before seeking any kind of loan.

Home Improvement Loans vs. Home Equity Loans

Regardless of the possibilities presented to Jon and Lucy, accessing unsecured home improvement loans could prove to be difficult. To receive home improvement loans the loan needs to be used to make improvements on a piece of property owned by the borrower. Often the homeowner should make an effort to prove that the improvements will increase the overall value of the home. Examples might be remodeling projects, decks, pools, room additions etc. Jon was looking to add a new roof and deck to the home since the old one was in a certain amount of disrepair. I felt he had a good chance at securing a loan if he could find the right contractor and price.

Since Jon was a young homeowner and hadn't been paying a mortgage there wasn't much equity to work with. If he could have acquired a home equity loan he'd be able to deduct the costs associated from his taxes. A general home improvement loan is a personal unsecured loan designed for short term use. Many homeowners like the fact that they don't have to tap into their equity to secure a loan. Home improvement loans also take less time to process than home equity loans. The interest rates are typically fixed with low monthly payments that can be paid off within 3-5 years.

What are your options?

However, the interest paid on a home improvement loan is not tax deductible like home equity loans. Because it is an unsecured loan it attracts borrowers with lower credit scores. It can be more difficult to acquire a basic home improvement loan with poor credit scores because lenders will often try to persuade the borrower to use their equity instead.

Get out your home improvement loans calculator today and see what options best suit your financial situation. Visit www.real-estate-yogi.com and speak with a representative any day of the week for free. They will guide you through your home improvement financing options. 1-866-987-1397.