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Home renovations: A guide to home improvement loans

by Susan McPherson 11/23/2022

person holding a power tool

Home improvements and renovations can be costly. Securing a home improvement loan is a great way to obtain financing for your home improvement project.

There are many home improvement financing options available on the market. The typical rate of these loans land around 3 percent to 36 percent. Comparing the interest rates and other factors of these loans can help you determine the best option for your home.

Defining a home improvement loans

Some home improvement loans are unsecured personal loans. These funds are allotted to help pay for the cost of home improvement projects. These projects can liven the space and even increase curb appeal. 

You don’t have to offer collateral to secure financing. These loans are based on personal information such as income and credit score. 

Home equity loans use your home to secure the financing. Typically, the interest rate is lower on these loans in comparison to an unsecured loan. Home improvement loans can be secured through your personal bank, online lenders and credit unions 

How does a home improvement loan work? 

Home improvement loans can be used for many home renovation projects. They can be used to update your kitchen or repair damage after a severe storm. These funds are granted specifically for home remodeling and improvements. 

Comparing home improvement loans

With so many choices of loans on the market, how do you choose? Some of the best home improvement loans have low APR rates and don’t penalize for a late monthly payment.  Calculating how much your home renovation costs will help pick the right loan. Some lenders have a max cap on their loan options. 

Acquiring home improvement financing 

Once you have compared loan options and have found one of interest, there are some additional steps to take. See if you pre-qualify for the loan. A simple form is usually provided that asks for your personal information. This can include your credit score. An excellent credit score is more likely to result in a better interest rate and increased loan amount. 

If the credit score is lower, having a co-signer can help you to secure the loan. A co-signer can also help to secure an agreeable interest rate. Once you have qualified for the loan, gather all required paperwork. This may include proof of address, pay information and more. 

Acquiring financing for home improvements can ensure you have the resources needed to make your project happen. Home renovation can boost the appeal of your space. If you would like to learn more about these loans, compare local options for the best option for your household.

About the Author

Susan McPherson

Welcome to my website, your number one source for Natick, MA Real Estate, Sherborn, MA Real Estate, Dover, MA Real Estate, Holliston, MA Real Estate, Framingham, MA Real Estate, Wellesley Real Estate MA, Wayland, MA Real Estate and surrounding towns.

My goal as a full time Real Estate professional is to provide my clients with the highest level of service. Selling Real Estate demands an agent who is first and foremost a professional able to navigate the challenges inherent in a real estate transaction. I feel that it is important to provide an array of information regarding all of your Real Estate needs in order to achieve your goals. What sets me apart from other realtors is my attention to detail, honesty, responsiveness, local market knowledge and commitment to exceptional customer service, which is validated by my customers’ reviews. You deserve a realtor who can communicate clearly and effectively while also serving as your coach and advocate and who will guide you through every step of the transaction. So, if you're thinking of buying or selling a home in the Massachusetts Metro West area, call me to help make your real estate dreams a reality. I welcome the opportunity to represent you in the sale or purchase of your home.