The home of a front porch decorated with a carved pumpkin and lanterns.

Haunted by home improvement needs? There’s a loan for that.

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Let’s take the scariness out of selecting a home improvement loan.

Boo! That first hint of winter chill can send a shiver down your spine. If your house is haunted with needs for repairs and updates (such as a new furnace to nip that chill before winter) now’s the time to think of the best ways to pay for home improvement.

Most homes have a few skeletons in the closet like leaks, faulty wiring, or bathrooms that scream 1970s. Maybe you have creaky floors that need updating or refinishing, or drafty windows that howl in horror when the winds blow, or kitchen appliances that should be allowed to rest in peace.

You could turn that haunted attic or basement into a fun workout space, crafts area, rec room, or home theater.

Lots of home improvement projects are best completed before winter sets in. After all, you’ll want to enjoy being inside during the darker, colder months. So, let’s keep the scary stuff on the front porch to entertain kids at Halloween, and make your home warm and inviting.

These loan ideas should put your mind at ease.

Home repair/home improvement loans

Need a fast fix up for your house so it sells for a great price, such as replacing the kitchen floor? In that case, don’t wait to save up enough cash to pay for the repairs – take out an unsecured personal home improvement loan instead.

An unsecured loan doesn’t require any collateral, so you can get the cash you need and get to work on your home repairs in a flash. Depending on your credit score, you could qualify for home improvement or home repair financing with excellent terms, limits, and APRs.

Of course, you can also use a home improvement loan for long-term additions, like adding a back deck or expanding the master bathroom to install a tub with jets. If you want to make your haunt more homely (or harrowing in time for Halloween!), choose a standard home improvement personal loan. They’re flexible, accessible, and available at Regional Finance today.

A person in the backyard of their home hanging lights around a decorative Halloween-themed table.

Home equity loans and home equity lines of credit

Does your witch’s castle have spooky character and equity? In that case, you have two loan choices that can take advantage of that fact.

A home equity loan or HEL lets you borrow money against the equity you’ve built up so far. You can calculate your equity by assessing your home’s current value and deducting the outstanding balance on your mortgage.

Why use a HEL? It can be a great choice to finance home improvements if you have a lot of equity built up and you need funds for a big, one-time project, like redoing the kitchen from the ground up.

A home equity line of credit or HELOC, on the other hand, is closer to a credit card than a traditional loan. You can borrow from this line of credit up to the preapproved limit, which is based on your house’s equity. Then you can pay it back and borrow from it again and again as needed.

Keep in mind that HELOC interest rates are adjustable, but you only owe interest on the outstanding HELOC balance at the end of every billing cycle. Because of this, a HELOC could be a great choice if you like to make regular home improvements or want to have a line of credit ready to go in case of a sudden repair need.

Say that a tree falls on the garage during a fall storm. Not good – you don’t really want your home’s bones to be visible like your decorative skeletons. A HELOC can let you make the repairs you need fast without having to reapply for another type of financing.

Government loans

The government offers certain home repair loans for new homeowners, too. Don’t worry, there’s no trick with this treat. If you qualify, these can be great options if you want to save on insurance and interest.

For instance, there’s the HUD Title I Property Improvement Loan. Unlike with a HEL/HELOC, you don’t need equity in your home and you can borrow up to $25,000. If you’re a new homeowner who purchased a fixer-upper, this government-backed loan could be the perfect ticket to repair your new house without breaking the bank.

That said, the money from the loan must go to renovations that improve the livability of the property, not purely cosmetic improvements. So some decorative home upgrades might not qualify.

You can also look into an FHA (Federal Housing Administration) 203(k) rehab loan. This is technically a type of mortgage – it allows you to buy a house with a lower-than-average down payment and is only appropriate if you buy a house that needs a lot of work.

With an FHA 203(k) loan, all the costs for necessary repairs and the mortgage are rolled into a single loan. Then you pay back the combined total with one mortgage payment per month.

This can also be useful if you want to purchase an inexpensive home that needs some serious renovations to turn into a livable space… or the perfect haunted house!

Cash-out refinancing

Aside from loans, there are a few other ways you can finance home repairs or improvements. Some homeowners choose to use a cash-out refinance to fund their house projects. But be careful – cash-out refinancing can lead to some downright scary fees that’ll leave you spooked long after you upgrade your house.

In a nutshell, a cash-out refinance replaces your current mortgage with a larger loan and a new interest rate. You then take the difference in value between the new loan and your older mortgage and use those funds to make any home repairs or improvements you need.

While this can be a quick way to get some extra cash for home improvements, you’ll also have to pay for related costs, like:

In essence, you’re taking out a new mortgage of your home so you must pay all the fees bundled with that contract. Plus, a cash-out refinance extends the term of your loan. It’ll take you longer to pay off your house. If your home improvements aren’t desperately needed, consider whether to use a cash-out refinance carefully.

Credit cards

Finally, you can always fund your home repairs and improvements with credit cards. A credit card could be a good option for home improvement financing if you’re only tackling minor-to-moderate projects, such as redoing your bathroom’s vanity, installing new closet organization, or making some minor repairs to the plumbing.

Depending on the credit card you qualify for, you could take advantage of interest-free financing for an introductory period, like 12 or 15 months. If you’re quick, you could use such a credit card to buy the supplies you need for your repairs or improvements, then pay off the credit card balance before the 0% APR offer ends.

A standard credit card with a regular APR can be a convenient way for you to purchase minor home improvement supplies in a pinch. But be sure do to pay a more than the minimum amount toward the credit card balance each month – a credit card can be a trick or treat depending on how you use it!

Choosing the right home improvement loan

The terrors of how to pay for home improvements can be dead and buried with the right home improvement loan or repair fund. We’d recommend choosing your loan, card, or other financing option based on the above information and:

Not sure which home financing option to choose? Your friends at Regional Finance can help. Not only do we offer personal loans for home improvement projects, but we can work with you to develop a financing strategy perfect for your budget. Contact a branch today for more information.

The information and materials provided on this website are intended for informational purposes only and should not be treated as an offer or solicitation of credit or any other product or service of Regional Finance or any other company. This website may contain links to websites controlled or offered by third parties. We have not reviewed all of the third-party sites linked to this website and are not responsible for the content, products, privacy policy, security, or practices of any linked third-party website. The inclusion of any third-party link does not imply any endorsement by Regional Finance of the linked third party, its website, or its product or services. Use of any third-party website is at your own risk.

Sources accessed 9/8/2021 –

Federal Trade Commission – Home Equity Loans and Credit Lines

US Department of Housing and Urban Development – About Title I Loans

US Department of Housing and Urban Development – 203(k) Rehab Mortgage Insurance

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