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When it comes to financing home improvements, remodeling, or
major house repairs, your home equity is one of the best
sources of funds. Low interest rates, flexible
loan terms, and tax deductible interest, make an equity loan
or an equity line of credit a practical choice for borrowing
money.
If a large amount of money is needed for home
improvement financing, an equity
loan can offer a one-time
distribution of funds, with long term fixed rate payments
making the loan easier to pay off over a longer term. For many people, the monthly payment is a primary
factor in the decision of how much financing to get, and the extent of
your home improvement project.
If you intend borrow a relatively small
amount
and pay back the principal quickly, a line of credit can cost
less than an equity loan. A line of credit also provides
flexibility in home improvement financing, with the convenience of
using money
in variable amounts, as needed for improvements.
Also, when deciding on the amount to
finance for your home improvements, be sure to itemize the estimated cost of your building
project.
Include items needed such as:
lumber, concrete, plumbing, flooring, cabinets, paint,
insulation, tile, fixtures, appliances, tools, safety equipment, labor,
building plans,
permits, clean-up, and a contingency amount for possible
unplanned expenses.
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