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A home improvement loan for remodeling can provide tax
deductible home equity cash for a complete home remodel, or a loan just for specific home improvements, which may increase the
value of your property based on the type of home remodeling projects, as well as the functionality.
Home improvements on your owner-occupied home can be financed with a home equity loan, where the lender
provides a one-time distribution of funds at closing, which
can be used to pay for your renovation projects as needed.
Home improvement loans borrow against home equity to improve existing
residential properties, which is different than construction loans for
building new structures from the foundation up.
Banks or lenders generally do not place
restrictions on your home remodeling projects, as long as the work
conforms to your local building requirements. You have the
choice of completing the work yourself, or using a licensed contractor.
If you are doing major home improvement that
requires a larger loan amount, remember that long term fixed rate payments
can make equity loans easier to pay off over an extended period of
If you only want to borrow a relatively small equity loan, and
pay it off quickly, a line of credit can provide more
flexibility with the convenience of withdrawing money in variable
amounts as needed, however, variable loan rates have the potential of increasing.
Lenders usually offer equity loans in terms with 5 year increments. Borrowers have a 3 day right to cancel if you change your mind.