Whether you walk life’s path alone, with a partner or with kids in tow it’s essential to have a place to call your own.
After all, your home is the one place where you can truly and completely be yourself. It’s the place where you kick off your shoes, take out your earrings, shake out your hair, slip into your pajamas and feel well and truly “you”. But over time, even the most beautiful and well maintained of homes can start to lose its luster. A growing patch of mold on the wall, a persistent chill from faulty loft insulation, inadequate roof tiles or failing pointing on your brickwork? All can weigh heavily on your mind. Not only do they detract from your home’s aesthetic appeal they can also diminish the value of your property. (Not to mention the safety of the building!)
If your home is in need of renovation you know that decisions cannot be made lightly or rushed into.
You have to ask yourself some searching questions first. Will the renovation add value to the home? Will it make the house feel more like home or do I need legal permission to carry it out? But chief among them is likely how will I afford it? Fortunately, there are a range of options open to you. Choosing the best one, however, depends entirely on your circumstances.
Credit where it’s due
The right decision will depend largely on your credit rating. You may not know if you have a good credit score or not or what determines the quality of your credit rating. This is relatively complicated but broadly speaking your credit rating as calculated by FICO is determined by how much you want to borrow, how much you’ve borrowed previously, how well you’re currently paying back your debts, what types of credit you have, historically how you’ve managed your debts and how long you’ve been in debt. Depending on how well you’re able to access good quality credit (i.e. credit that isn’t going to mire you in debt) the best option for you may be…
Remortgaging
Do you own your own home and have been paying your mortgage off diligently over the years? You may be able to remortgage the home and release some of the equity that you’ve put into the property. Usually the interest rates will be far more favorable than with a commercial loan. And if as you have a verifiable employment history and a sound credit score, your bank may approve it.
Home improvement loans
If you haven’t enough equity to release on your property to fund necessary renovations you may find more luck with a home improvement loan. These tend to be unsecured and at relatively low interest. Although, you may face an origination fee of up to 5-6% of your overall loan.
Bridging loans
If you intend to sell your property soon but need to carry out extensive renovations quickly before the sale goes through, a bridging loan may be your best option. Bridging loans can be arranged far more quickly than home improvement loans allowing you to act more decisively. Because they are a intended as a short term solution, however, their interest rates are much higher.
With the right product and a little knowledge, your home will be transformed.
